Madras High Court
Vikram Khurana vs \25 on 17 April, 2025
Author: T.V.Thamilselvi
Bench: T.V.Thamilselvi
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 17.04.2025
CORAM:
THE HON'BLE MRS.JUSTICE T.V.THAMILSELVI
Crl.O.P.No.6328 of 2021
and
Crl.M.P.No.4196 of 2021
1.Vikram Khurana
2.M/s.Kaapi Solutions India OPC Private Limited,
(CIN: U74140DL20150PC278527)
A One person company,
Registered under the Companies Act, 2013,
With its Registered Office at No.3, Block-A,
Phase-1, Naraina Industrial Area,
South West Delhi,
Delhi-110 028.
Represented by its Director,
Mrs.Sandhya Khurana (DIN: 07078836)
3.Sandhya Khurana
4.S.Srinivasalu
5.Rajesh Yambem
6.Dilpreet Singh
7.Santhosh Gavkhadkar
8.Rehman Khaleel ... Petitioners/ A1 to A8
Vs.
1\25
https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm )
M/s.Kaapi Machines (India) Private Limited,
(CIN:U29219TZ2006PTC013246)
A Private Limited Company incorporated under the provisions of the
erstwhile Companies Act., 1956,
With its Registered Office at
No.1054/21, Avinashi Road,
Coimbatore-641 018.
Tamil Nadu, India,
Represented by its Director,
K.Balasundararaman
(DIN:03212295) ... Respondent
PRAYER: Criminal Original Petition filed under Section 482 of Criminal
Procedure Code, prayed to call for records in the complaint filed by the
respondent company in C.C.No.434 of 2018 on the file of the Judicial
Maistrate-III, Coimbatore and quash the same as against the petitioners.
For Petitioners : Mr.N.L.Rajah, Senior Counsel
for Mr.N.S.Ramanan
For Respondent : Mr.B.Kumar, Senior Counsel
for Mr.B.Ramachandran
ORDER
The petitioners herein, who are accused Nos. 1 to 8, have preferred this petition to quash C.C. No. 434 of 2018, pending before the learned 2\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) Judicial Magistrate-III, Coimbatore, along with other consequential reliefs against the respondent/defacto complainant.
2. The 2nd petitioner is a registered company under the name and style of M/s. Kaapi Solutions India OPC Private Limited, represented by its Director, Mrs. Sandhya Khurana (3rd petitioner herein). The respondent/defacto complainant is a registered company in the name and style of M/s. Kaapi Machines (India) Private Limited, represented by its Director, Mr. K. Balasundararaman. Petitioners 4 to 8 were employees of the respondent company. The 3rd petitioner is the wife of the 1st petitioner, and the 2nd petitioner company is managed by the 3rd petitioner.
3. The learned counsel for the petitioners submitted that all the petitioners are innocent and have not committed any of the offences alleged by the respondent. They were all employees of the respondent company, which is primarily engaged in the business of importing, assembling, distributing, and selling electronically operated coffee machines and related equipment. He further submitted that the 1st petitioner is an expert in the 3\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) field of coffee brewing and had the distinction of being a finalist at the renowned World Barista Championship held in Boston in 2006. Owing to his qualifications and experience, the 1st petitioner was appointed as the Chief Executive Officer (CEO) of the respondent company on 21.06.2007. After assuming the role, he worked diligently and with great commitment, leading the company to significant growth and expansion into international markets. The petitioners state that petitioners 4 to 7 also joined the respondent company in various capacities and contributed immensely to its development. It is pertinent to mention here that the respondent company had provided laptop computers to the 1st and 6th petitioners for official use, which were to be returned upon resignation, removal, or retirement.
4. The petitioners state that while this was the situation, on 30.03.2015, the 3rd petitioner incorporated the 2nd petitioner company, which is engaged in providing solutions for coffee and tea vending machines. The 2nd petitioner company was wholly set up and is solely managed by the 3rd petitioner, without any assistance from the 1st petitioner or the other petitioners. The petitioners further state that, in 2017, 4\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) the 1st petitioner decided to start his own business venture along with other partners in a manner that would not compete with the business activities of the respondent company. In this regard, the 1st petitioner submitted his resignation letter dated 24.01.2017 to the respondent company. He also communicated his intention to start a non-competing business during a meeting held on 03.02.2017 at Bangalore. The directors of the respondent company raised no objections during that meeting. It was agreed that the 1st petitioner would be officially relieved from his duties on 31.03.2017. Subsequently, the 1st petitioner returned the company-provided laptop on 11.04.2017. Following the resignation of the 1st petitioner, petitioners 4 to 7 also resigned from their employment with the respondent company for personal reasons. The 6th petitioner also returned his company-issued laptop upon resignation.
5. The petitioners claim that the respondent company was reluctant to accept the resignation of the 1st petitioner, as they found it difficult to find a suitable replacement. Despite the 1st petitioner assuring that his new business would not compete with the respondent company, the latter grew 5\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) apprehensive that its performance would suffer due to the petitioner's departure. The company also resented the resignations of petitioners 4 to 7. Therefore, with an intent to sabotage the 2nd petitioner’s business and to take revenge on all the petitioners, the respondent company filed a false and vexatious complaint.
6. The respondent company filed a complaint under Section 200 of the Criminal Procedure Code, 1973, numbered as C.C. No. 434 of 2018, under Sections 405, 409, 415, 416, 418, and 420 of the Indian Penal Code, 1860, and Section 66D of the Information Technology Act, 2000. The complaint is based solely on the alleged findings from a forensic examination of the laptops used by the 1st and 6th petitioners. Based on this information, the respondent company falsely alleges that the 1st petitioner assisted the 3rd petitioner in incorporating the 2nd petitioner company and helped secure clients by poaching them from the respondent company. It also claims that petitioners 4 to 7 supported the 1st petitioner in these activities.
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7. The learned counsel for the petitioners further contended that the learned Magistrate has erroneously taken the complaint on file without examining whether the said Court has jurisdiction to pass orders pursuant to the complaint preferred by the respondent. As per Section 182 of the Code of Criminal Procedure, 1973, only the Courts within whose jurisdiction the electronic communications or e-mails were sent or received can entertain complaints with respect to the commission of such offences.
8. It is pertinent to mention that in the complaint filed by the respondent company, there is no mention as to where the e-mail communications originated or where they were received. Hence, without determining the location of origin and destination of the alleged e-mail communications and without examining whether the Court has jurisdiction to entertain the complaint, the learned Magistrate ought not to have accepted the complaint filed by the respondent company. 7\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm )
9. Further, the 1st petitioner contended that, according to the allegations made against him by the respondent company, he had deleted certain files before returning his computer on 11.04.2017. These deleted files were allegedly recovered by conducting a forensic analysis of the said computer, and the present complaint is based on the information extracted from such analysis.
10. The petitioners argue that this is a sheer violation of the Fundamental Right to Privacy of the 1st petitioner. The computer in question was issued by the respondent company and was used by the 1st petitioner during his employment. Upon cessation of his employment, the computer was returned to the respondent company. However, the respondent company infringed upon the petitioner’s Right to Privacy by extracting files that had been deleted by him, without obtaining his consent or permission.
11. One of the files allegedly extracted during this forensic analysis was the 1st petitioner’s bank account statement, which is purely personal 8\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) information. The forensic examiner’s report also notes that information regarding the websites visited by the 1st petitioner was retrieved. By extracting such personal data, the respondent has committed a blatant violation of the petitioner’s Right to Privacy. Consequently, all evidence obtained through this illegal process must be eschewed by the Court. The same argument applies to the documents obtained from the 6th petitioner’s computer.
12. The petitioners further submit that the documents numbered 10 to 12 furnished by the respondent company along with its complaint are printouts of e-mail communications, and documents numbered 14 to 26 were allegedly obtained from the forensic analysis of the computers belonging to petitioners 1 and 6. These documents are therefore in the nature of secondary evidence derived from electronic records.
13. According to Section 65A of the Indian Evidence Act, the contents of electronic records must be proved in accordance with Section 65B of the Act. The allegations against the petitioners are based solely on the electronic records filed by the respondent as documents numbered 14 to 9\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm )
26. Out of these, documents numbered 14 to 24 are stated to have been extracted from the 1st petitioner’s computer. However, in the absence of a certificate under Section 65B(4) of the Indian Evidence Act, such documents are not admissible, and therefore there is no valid proof against the petitioners from the side of the respondent company.
14. Additionally, the other allegations against the petitioners, that they colluded with the 1st petitioner, conspired to misuse confidential information, and diverted the business of the respondent company to the 2nd accused by diluting its goodwill are not supported by any valid material particulars. Therefore, none of the allegations are made out, nor do they contain the necessary ingredients to constitute the alleged offences.
15. The present complaint, being filed without jurisdiction and violating the fundamental rights of the petitioners, amounts to an abuse of the process of law. The petitioners, therefore, pray for the entire proceedings to be quashed. They further submit that they have made out a prima facie case and that the balance of convenience lies in their favour. If 10\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) the prosecution is allowed to continue, it would result in grave injustice.
Hence, the proceedings ought not to be permitted to continue.
16. In support of their contentions, the petitioners relied on the following authority:
(i) Criminal Appeal No.744 of 2000, Navinchandra N. Majithia vs. State of Maharashtra and others, in which it was held as follows:
“ 21.So far as the question of territorial jurisdiction with reference to a criminal offence is concerned the main factor to be considered is the place where the alleged offence was committed.
23. This Court held that under Section 177 of the Criminal Procedure Code "every offence shall ordinarily be enquired into and tried in a Court within whose jurisdiction it was committed". The locality where the bank (which dishonoured the cheque) is situated cannot be regarded as the sole criterion to determine the place of offence. The offence under Section 138 of the N.I. Act would not be completed with the dishonor of the cheque. It attains completion only with the failure of the drawer of the cheque to pay the cheque amount within the expiry of 15 days mentioned in Clause (c) of the proviso to Section 138 of the Act. It is normally difficult to fix 11\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) up a particular locality as the place of failure to pay the amount covered by the cheque. A place, for that purpose, would depend upon a variety of factors. It can either be at the place where the drawer resides or at the place where the payee resides or at the place where either of them carries on business. This Court further held that Section 178 of the Criminal Procedure Code suggests that if there is uncertainly as to where, among different localities, the offence would have been, committed the trial can be had in a court having jurisdiction over any of those localities. The provision has turner widened the scope by stating that in case where the offence was committed partly in one local area and partly in another local area the Court in either of the localities can exercise jurisdiction to try the case. Further again, Section 179 of the Code stretches its scope to a still wider horizon.”
(ii) In Crl.O.P.No.20088 of 2013, Crl.M.P.Nos.2 & 3 of 2011, Nissan Motors, Corporate Office and Ors. Vs.S.Giri Prasad, in paragraph 24 stated as follows:
“ 24.The Hon'ble Apex Court and this Court in several cases held that the summoning of an accused in a Criminal case is a serious matter and the summoning order must reflect about application of mind to the facts of the case and the law applicable thereto. In this case, the learned XVIII 12\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) Metropolitan Magistrate, Saidapet did not even record as to what are the materials perused upon which cognizance has been taken. Strangely, the learned Magistrate has simply ordered to issue summons to the accused.” (Iii) In the case of Hon'ble Supreme Court of India, in Criminal Appeal No.738 of 2007 (Arising out of SLP (Crl.) No.1534 of 2006), Asit Bhattacharjee Vs. Hanuman Prasad Ojha and ors. in which held as follows:
“ 28. Fraudulent representation being one of the essential ingredients in respect of commission of an offence under Section 420 of the Indian Penal Code, a place where such fraudulent misrepresentation has been made would, thus, give rise to a cause of action for prosecuting the accused. Similarly, having regard to the ingredients of an offence under Section 406 where the entrustments were made as also the situs where the offence was completed in the sense that the amount entrusted had not been accounted for by the agent to the principal will also have a nexus so as to enable to the Court concerned to exercise its jurisdiction of taking cognizance. Furthermore, whether the offence forgery of some documents committed or some other criminal misconducts are 13\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) said to have been committed in furtherance of the commission of the principal offence of cheating and misappropriation where for the respondents are said to have entered into a criminal conspiracy; are required to be investigated. The Chief Metropolitan Magistrate, thus, had jurisdiction in the matter in terms of Section 178 read with Section 181(4) of the Code of Criminal Procedure.
31. No such explicit prayer was made by the respondents in their writ petition, although a prayer for issuance of a writ in the nature of mandamus, directing the State of West Bengal to transfer Case No. 381 to the State of U.P., had been made. The question of State of West Bengal's having a legal duty in that behalf did not arise. Only in the event an Investigating Officer, having regard to the provisions contained in Section 154, 162, 177 and 178 of the Code of Criminal Procedure had arrived at a finding that the alleged crime was not committed within his territorial jurisdiction, could forward the First Information Report to the Police having jurisdiction in the matter”.
17. The learned counsel for the respondent / de facto complainant submitted that the complainant is the largest Indian importer and supplier of 14\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) coffee machines and related apparatus, and is a pioneer in the field of integrated beverage equipment solutions in India. The complainant is a total solution provider in the coffee machine space, offering training, service, and maintenance facilities to its clients, in addition to the supply of coffee machines. It has come to be recognized by its tag line: “One Stop Solution for Coffee Business.” The complainant has been carrying on business continuously and uninterruptedly since its incorporation in the year 2006 and has extended its business operations to Nepal, Bhutan, Nigeria, Maldives, Singapore, and Sri Lanka.
18. The first petitioner /A1 was formerly employed by the complainant as the Chief Executive Officer (CEO) from June 21, 2007, to March 31, 2017. He claimed to be an expert in the field of brewing coffee and even offered to subscribe for shares in the complainant company. As CEO, he was entrusted with all the confidential and secure information of the complainant, including its trade secrets, client lists, business operations, financial plans, private contracts, etc. (collectively referred to as “Confidential Information”). In light of this, the first accused executed a 15\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) Confidentiality, Non-Disclosure, and Non-Compete Agreement dated 21.11.2007, which imposed stringent conditions and restrictions.
19. After nearly 10 years of service, on January 24, 2017, the first accused, without any prior indication, tendered his resignation, citing personal reasons. In his resignation email, he stated that he would serve the notice period and continue as CEO till March 31, 2017, to ensure a smooth transition and complete the handover of duties. A copy of the resignation email is produced as Document No.8. In the same email, the first accused informed shareholders that after stepping down as CEO, he intended to explore new business concepts in India, including coffee and coffee equipment for the home segment, a market in which the complainant had no existing presence. He assured the shareholders that his new venture would not compete with the complainant and that he had no intention to recruit any personnel from the complainant or its business partners. He also promised to consider an offer to join the Board of the complainant after discussions with his new business partners.
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20. However, during the notice period from January 25, 2017, to March 31, 2017, instead of cooperating with the complainant in the handover process, the first accused behaved evasively and avoided sharing necessary information such as client lists, ongoing business updates, access to correspondence with business collaborators, and other critical data sought by the complainant. This suspicious behavior raised serious concerns.
21. Later, the complainant learned from industry sources that the first accused had attended various industry exhibitions and conferences during the same period in which he claimed to be unwell. A copy of the first accused’s flight tickets to Shanghai during his notice period, coinciding with the “HOTELEX Shanghai” Hospitality Equipment & Food Service Expo, was obtained as evidence.
22. Further, several emails, documents, and other correspondence discovered by the complainant revealed that the first accused had secretly 17\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) incorporated the second accused company with fraudulent intentions to siphon off the business of the complainant. To achieve this, the first accused concealed the incorporation from the complainant and continued to serve as CEO for nearly two years after setting up the second accused company. During this time, he had complete access to all confidential information, board meeting minutes, annual business plans, strategies, projections, customer and sales data, and other sensitive materials. He misused the complainant’s confidential information, infrastructure, and identity, as well as his official position, to manipulate and undermine the complainant’s business.
23. The first accused also poached several key employees from the complainant by soliciting them to join the second accused company. These employees had been extensively trained by the complainant over several years, with significant investment of time, money, and resources. These individuals, having access to confidential data, are likely to have conspired with the first and third accused to divert the complainant’s business. These employees resigned around the same time the first accused stepped down. A 18\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) list of these individuals is produced as Document No.27. The complainant respectfully submits that if further investigation reveals their involvement, appropriate action may be initiated against them.
24. It is submitted that all these facts transpired prior to the filing of the complaint. The learned counsel for the respondent argued that there is sufficient material to prosecute the petitioners. The learned Magistrate found prima facie material and accordingly took the complaint on file. There are no infirmities in the proceedings, and the petition deserves to be dismissed as it lacks merit.
25. To support his arguments, the learned counsel relied on the following authorities:
(i) (2019) 16 SCC 610; (2020) 2 SCC (Civ) 713; 2019 SCC Online SC 682, it was held:
“Intention is the gist of the offence. It is the intention of the taker/replicator of documents that determines whether taking or replicating a document amounts to theft. Intention to take dishonestly exists when the taker intends to cause 19\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) wrongful loss to another. This amounts to theft. It is an essential ingredient of the offence of theft that movable property should have been moved out of the possession of any person without his consent.”
(ii). In Supreme Court Cases (2017) 15 SCC, in which stated as follows:
“ 41. Elaborating on the fiduciary relationship between the employee of a firm to safeguard the confidential information owned by the firm, the Court observed as under:
(Carpenter case19, SCC OnLine US SC paras 14-15) "14. The District Court found that Winans' undertaking at the Journal was not to reveal pre-publication information about his column, a promise that became a sham when in violation of his duty he passed along to his co-conspirators confidential information belonging to the Journal, pursuant to an ongoing scheme to share profits from trading in anticipation of the "Heard" column's impact on the stock market. In Snepp v. United States23 (per curiam), although a decision grounded in the provisions of a written trust agreement prohibiting the unapproved use of confidential Government information, we noted the similar prohibitions of the common law, that "even in the absence of a written contract, an employee has a fiduciary obligation to protect confidential information obtained during the course of his employment." As the New York courts have recognised: "It is well established, as a general proposition, that a person whe acquires special knowledge or information by virtue of a confidential of fiduciary relationship with another is not free to exploit that knowledge of information for his own personal benefit but must account to his principal for any profits derived therefrom." Diamond v. Oreamuno24; see also 20\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) Restatement (Second) of Agency Sections 388, Comment c, 396(c)(1958).
15. We have little trouble in holding that the conspiracy here to trade on the Journal's confidential information is not outside the reach of the mail and wire fraud statutes, provided the other elements of the offenses are satisfied. The Journal's business information that it intended to be kept confidential was its property; the declaration to that effect in the employee manual merely removed any doubts on that score and made the finding of specific intent to defraud that much easier.
Winans continued in the employ of the Journal, appropriating its confidential business information for his own use, all the while pretending to perform his duty of safeguarding it. In fact, he told his editors twice about leaks of confidential information not related to the stock-trading scheme, United States v. Winans25, demonstrating both his knowledge that the Journal viewed information concerning the "Heard" column as confidential and his deceit as he played the role of a loyal employee."
46. The law of confidentiality has a bearing on this case instant. "Confidential information acquired or compiled by a corporation in the course and conduct of its business is a species of property to which the corporation has the exclusive right and benefit, and which a court of equity will protect through the injunctive process or other appropriate remedy."27 The information of possible trades that the company is going to undertake is the confidential information of the company concerned, which it has absolute liberty to 21\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) deal with. Therefore, a person conveying confidential information to another person (tippee) breaches his duty prescribed by law and if the recipient of such information knows of the breach and trades, and there is an inducement to bring about an inequitable result, then the recipient tippee may be said to have committed the fraud.”
26. Upon considering the submissions made by both sides and the allegations leveled against the petitioners, it is observed that the 1st petitioner, while serving as the CEO of the complainant's company, was entrusted with all confidential information, including trade secrets, business operations, and financial details. To that effect, a confidentiality agreement dated 21.11.2007 was also executed by him.
27. However, contrary to the terms of the said agreement, the 1st accused/1st petitioner is stated to have incorporated the 2nd accused as a One Person Company while he was still in the service of the complainant. As per the forensic report, approximately 7,500 files provided to the complainant were allegedly copied and subsequently deleted without the 22\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) knowledge or consent of the complainant.
28. In view of these prima facie materials, the complainant approached the trial court and also lodged a complaint in this regard. The other petitioners, who were also employees of the complainant’s company, resigned immediately after the resignation of the 1st accused. This sequence of events has led the respondent’s company to establish that all the accused conspired and colluded together by sharing confidential information, thereby committing contractual breaches with the intent to cause damage to the complainant. Consequently, their illegal actions have led to prosecution.
29. If the petitioners have any defense, they are entitled to work out their remedies before the trial court. Considering the grave nature of the allegations against the petitioners, this Court is not inclined to allow this petition.
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30. The authorities relied upon by the petitioners are not applicable to the facts of the present case. On the other hand, the authorities cited by the defacto complainant support their contentions. Considering the grave nature of the offences, this Court is not inclined to quash the proceedings against the petitioners.
31. Accordingly, this petition is dismissed. Consequently, connected miscellaneous petition is closed.
17.04.2025 rri To
1. The Judicial Magistrate No.III, Coimbatore.
2. The Public Prosecutor, High Court of Madras.
24\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm ) T.V.THAMILSELVI, J.
rri Crl.O.P.No.6328 of 2021 and Crl.M.P.No.4196 of 2021 17.04.2025 25\25 https://www.mhc.tn.gov.in/judis ( Uploaded on: 06/05/2025 08:16:39 pm )