Karnataka High Court
Shri Appasaheb A Shirgave vs The State Of Karnataka on 28 April, 2026
Author: Hanchate Sanjeevkumar
Bench: Hanchate Sanjeevkumar
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CRL.P No. 104513 of 2025
HC-KAR
IN THE HIGH COURT OF KARNATAKA, AT DHARWAD
DATED THIS THE 28TH DAY OF APRIL, 2026
BEFORE
THE HON'BLE MR. JUSTICE HANCHATE SANJEEVKUMAR
CRIMINAL PETITION NO.104513 OF 2025
(482 OF Cr.PC/528 OF BNSS)
BETWEEN:
1. SHRI APPASAHEB A. SHIRGAVE,
AGE: 58 YEARS,
OCC: SERVICE AS A M.D.,
R/O. SHANKARANAND NAGAR,
NIPANI, TAL. NIPANI,
DIST. BELAGAVI-591237.
2. SHRI MALAGOUDA PIRAGOUDA PATIL,
AGE: 76 YEARS, OCC: AGRIL. &
CHIRMAN OF THE SUGAR FACTORY,
R/O. JATRAT, TAL. NIPANI,
DIST. BELAGAVI-591237.
3. SHRI PAVANKUMAR MAHAVEER PATIL,
Digitally signed
by
MALLIKARJUN
AGE: 55 YEARS,
RUDRAYYA
KALMATH OCC: AGRIL. & VICE CHAIRMAN
Location: High
Court of
Karnataka,
OF THE SUGAR FACTORY,
Dharwad Bench
R/O. MANGUR, TAL. NIPANI,
TQ. NIPANI, DIST. BELAGAVI-591237.
4. SHRI RAVINDRA DHARAGOUDA PATIL,
AGE: 55 YEARS,
OCC: SERVICE AS A GENERAL MANAGER,
R/O. PLOT NO.2015, SECTOR-9,
M. M. EXTN, BELAGAVI,
DIST. BELAGAVI-590001.
5. SRI KEMPANNA NAGAPPA GIJAVANE,
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AGE: 50 YEARS,
OCC: SERVICE AS A GENERAL MANAGER
PROCESS & CHIEF CHEMIST,
A/P. NEAR MAHALAXMI MANDIR,
MUTNAL, TAL. GADHINGLAJ,
DIST. KOLHAPUR,
MAHARASHTRA-416502.
6. SRI AMOL SHANKAR KAMATE,
AGE: 35 YEARS,
OCC: SERVICE AS A GODOWN KEEPER,
R/O. MANGUR, TAL. NIPANI,
DIST. BELAGAVI-591237.
7. SRI VIJAY KHADAKBHAVI,
AGE: 45 YEARS,
OCC: SERVICE AS A SALES MANAGER,
R/O. KARGAON, TAL. CHIKODI,
DIST. BELAGAVI-591201.
8. SRI BHUJANGA J. DAVARI,
AGE: 61 YEARS,
OCC: SERVICE AS A SECURITY OFFICER,
R/O. DOLLORS COLONY,
SHIRGUPPI ROAD, NIPANI,
TAL. NIPANI, DIST. BELAGAVI-591237.
9. SRI APPASAHEB SHIVRAM JOLLE,
AGE: 60 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. EXAMBA, TAL. CHIKODI,
DIST. BELAGAVI-591201.
10. SRI VISHWANATH SADASHIV KAMATE,
AGE: 66 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. KHADAKLAT, TAL. CHIKODI,
DIST. BELAGAVI-591201.
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11. SHRI AVINASH ANNASAHEB PATIL,
AGE: 56 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. NANGANUR, TAL. NIPANI,
DIST. BELAGAVI-591237.
12. RAMAGONDA BALAGONDA PATIL,
AGE: 74 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. JANAWAD, TAL. CHIKODI,
DIST. BELAGAVI-591201.
13. SRI SUKUMAR BABURAO PATIL,
(VIDE ORDER DATED 07.04.2026
PETITIONER NO.13 IS DELETED).
14. SRI SAMIT BABASAHEB SASANE,
AGE: 38 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. PADALIHAL, TAL. NIPANI,
DIST. BELAGAVI-591237.
15. SRI JAYKUMAR APPASAHEB KHOT,
AGE: 61 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. SHAMANEWADI, TAL. CHIKODI,
DIST. BELAGAVI-591201.
16. SRI PRAKASH RAJARAM SHINDE,
AGE: 55 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. BHIVASHI, TAL. NIPANI,
DIST. BELAGAVI-591237.
17. SRI RAMESH MAHADEV PATIL,
AGE: 50 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. BENADI, TAL. NIPANI,
DIST. BELAGAVI-591237.
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18. SRI RAVASAHEB DATTU FARALE,
AGE: 65 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. AKKOL, TAL. NIPANI,
DIST. BELAGAVI-591237.
19. SRI SHARAD BALASAHEB JANGATE,
AGE: 45 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. BORGAON, TAL. NIPANI,
DIST. BELAGAVI-591237.
20. SRI VINAYAK RAMAGONDA PATIL,
AGE: 32 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. RAMPUR, TAL. CHIKODI,
DIST. BELAGAVI-591201.
21. SRI JAYWANT GANGARAM BHATALE,
AGE: 55 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. AKKOL ROAD,
NIPANI, TAL. NIPANI,
DIST. BELAGAVI-591237.
22. SRI SUHAS SIDRAM GUGE,
AGE: 58 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. AKKOL, TAL. NIPANI,
DIST. BELAGAVI-591237.
23. SOU. GEETA W/O. SUNIL PATIL,
AGE: 50 YEARS,
OCC: HOUSEHOLD WORK &
DIRECTOR OF THE SUGAR FACTORY,
R/O. MAHADEV GALLI,
NIPANI, TAL. NIPANI,
DIST. BELAGAVI-591237.
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24. SMT. VAISHALI KIRAN NIKADE,
AGE: 40 YEARS, OCC: HOUSEHOLD
& DIRECTOR OF THE SUGAR FACTORY,
R/O. KURLI, TAL. NIPANI,
DIST. BELAGAVI-591237.
25. SRI SHRIKANT CHOODAPPA BANNE,
AGE: 42 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. GALATAGA, TAL. NIPANI,
DIST. BELAGAVI-591237.
26. SRI RAJU
@ RAJENDAR SHANTILAL SHAHA,
AGE: 58 YEARS, OCC: AGRIL. &
DIRECTOR OF THE SUGAR FACTORY,
R/O. MANIK NAGAR,
OPP. SUB REGISTRAR OFFICE,
NIPANI TAL, DIST. BELAGAVI-591237.
...RESPONDENTS
(SRI V. M. SHEELVANT, ADV. FOR PETITIONER NO.1 TO 12 AND 14 TO 26;
V/O. DATED 07.04.2026 PETITIONER NO.13-DELETED) AND
1. THE STATE OF KARNATAKA, BY BASAWESHWAR CHOWK P.S., R/BY THE ADDITIONAL STATE PUBLIC PROSECUTOR, HIGH COURT OF KARNATAKA, DHARWAD BENCH-580011.
2. DATTATRAY APPASAHEB LATKAR, AGE: 57 YEARS, OCC: FARMER AT: 2001, AKKOL ROAD, LATKAR HOUSE, TQ. NIPPANI, -6- NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR DIST. BELAGAVI-591237.
3. DATTATRAY ANANT KULKARNI, AGE: 54 YEARS, OCC: FARMER, AT: BUDIHAL, TQ. NIPPANI, DIST. BELAGAVI-591317.
4. BABASO RAMANGONDA KHOKATE, AGE: 44 YEARS, OCC: FARMER, AT JATRAT, TQ. NIPPANI, DIST. BELAGAVI-591237.
5. RAJSHREE SANJAY WAQH, AGE: 55 YEARS, OCC: HOUSE HOLD, AT: PATTANAKUDI, TQ. CHIKKODI, DIST. BELAGAVI-591238.
...RESPONDENTS (BY SRI ABHISHEK MALIPATIL, HCGP FOR R1; SRI PRASHANT MATHAPATI, ADV. FOR R2 TO R5; SRI K. L. PATIL, ADV. FOR R2) THIS CRIMINAL PETITION IS FILED UNDER SECTION 482 OF THE CODE OF CRIMINAL PROCEDURE, (UNDER SECTION 528 OF BNSS, 2023) PRAYING TO QUASH THE PRIVATE COMPLAINT FILED IN 703/2025 AND FIR REGISTERED IN BASAWESHWAR CHOWK P.S. CRIME NO.57/2025 PENDING ON THE FILE OF PRINCIPAL CIVIL JUDGE AND JMFC, NIPPANI FOR THE OFFENCES PUNISHABLE UNDER SECTIONS 316(2), 318, 318(2), 320, 324, 303(2) R/W. SECTION 3(5) OF BNS AGAINST THE PETITIONERS (ACCUSED NO. 1 TO 26), IN THE INTEREST OF JUSTICE AND ETC.
THIS PETITION HAVING BEEN HEARD AND RESERVED FOR ORDERS AND COMING ON FOR PRONOUNCEMENT OF ORDERS THIS DAY, THIS COURT MADE THE FOLLOWING: -7-
NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR CORAM: HON'BLE MR. JUSTICE HANCHATE SANJEEVKUMAR CAV ORDER This petition is filed by Accused Nos.1 to 26 under Section 482 of Code of Criminal Procedure1 r/w Section 528 of Bharatiya Nagarik Suraksha Sanhita, 20232, seeking to quash the criminal proceedings, as per the prayer set out below:
"WHEREFORE, for these and among other grounds to be urged at the time of hearing it is most humbly prayed before this Hon'ble court that this Hon'ble Court may kindly be pleased to:
a. Quash the Private Complaint filed in 703/2025 and FIR registered in Basaweshwar Chowk PS crime No.57/2025 pending on the file of Prl.Civil Judge and JMFC, Nippani for the offences punishable U/s 316(2), 318, 318(2), 320, 324, 303(2) R/w 3(5) of BNS against the petitioners (Accused No.1 to 26) in the interest of Justice.
b. Pass any other reliefs as this Hon'ble Court deems fit in the ends of justice".1
Hereinafter referred to as "Cr.P.C." 2 Hereinafter referred to as "BNSS, 2023" -8-
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2. Respondent Nos.2 to 5, who are the complainants, have filed a private complaint under Section 200 of Cr.P.C., stating that they are agriculturists and members of a sugar factory, namely Sri Halasidanath Sahakari Sakkare Karakhane Ltd., Nippani3. The complainants are sugarcane growers and, being registered members of the factory, supply sugarcane to it. The factory is registered under the Multi-State Co-operative Societies Act, 2002.
3. The petitioners/accused are the Chairman, Vice- Chairman, Managing Director, officers, office bearers, directors, and members of the Managing Committee of the factory. They are in control of the day-to-day management, affairs, and transactions of the factory, as per the provisions of the Act and the bye-laws.
4. It is alleged that all the accused, acting in collusion, falsified records and reports relating to sugar production by illegally diverting and storing approximately 3 Hereinafter referred to as " the factory" -9-
NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR 50,000 quintals of sugar in a godown during the crushing season 2024-25, and thereafter gradually selling the same for personal gain. This allegedly caused heavy losses to the factory and to the sugarcane growers, amounting to offences of theft, fraud, and cheating. The complainants, being agriculturists, have also suffered losses due to the acts of the accused.
5. The factory purchases sugarcane from growers and manufactures sugar and ethanol. As per the Sugarcane (Control) Order, 19664, sugar is an essential commodity, and the Central Government fixes the Fair and Remunerative Price5 payable to growers, as well as the minimum selling price of sugar. For the crushing season 2024-25, the FRP was fixed at Rs.340 per quintal (Rs.3,400 per metric tonne) at a basic recovery rate of 10.25%.
6. It is stated that during the said season, the factory crushed 630,457.972 metric tonnes of sugarcane 4 Hereinafter referred to as "Order, 1966" 5
Hereinafter referred to as "FRP"
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR between 08.11.2024 and 13.02.2025, showing an official recovery of 11.43%. However, it is alleged that the factory actually produced approximately 50,000 quintals more sugar than reported, but the same was not recorded, thereby reducing the recovery rate from an actual 12.20% to 11.43%. This allegedly resulted in a loss of approximately Rs.16.11 crores to the growers.
7. The complainants claim that they visited the factory and its godowns and observed excess sugar bags beyond what was recorded. They further state that such excess stock was being sold between 14.12.2024 and 10.01.2025. A complaint was lodged with the Commercial Tax Department. Upon inspection conducted on 21st and 22nd April 2025, officials found 5,084 excess bags of sugar in one godown. It is alleged that the accused had already sold a substantial quantity of unrecorded sugar prior to inspection. A notice dated 23.04.2025 was issued, and the accused paid a penalty of Rs.97,99,410/-, thereby admitting illegal acts and offence. According to the complainants, this
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR confirms the existence of unrecorded stock and illegal diversion.
8. The complainants submit that the accused, in furtherance of a common intention and conspiracy, failed to record excess production and instead sold it privately, siphoning off approximately Rs.16-17 crores. After failing to secure police action, they filed a private complaint. The learned Magistrate ordered investigation under Section 156(3) Cr.P.C., leading to registration of the case. Being aggrieved by the same, the accused have filed this petition seeking to quash the criminal proceedings.
9. Heard the learned counsel for the petitioners and the learned counsel for respondent Nos.2 to 5/complainants as well as learned HCGP for the State and perused the records.
10. Learned counsel for the petitioners submitted that the excess sugar bags found in the godown were inspected by the Commercial Tax authorities, who imposed
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR a penalty of Rs.97,99,410/-, and the same has been paid by the factory. Therefore, it is contended that no offence, as alleged, has been committed. It is further submitted that during the inspection by the Commercial Tax authorities, excess sugar bags were found and a penalty was paid as demanded, and thus the same does not amount to theft or cheating. It is further submitted that the entire allegation is based on presumption and assumption; therefore, on such basis, the complaint cannot be maintained.
11. It is submitted that, upon a reading of the entire complaint averments, there are no allegations that the sugar product was sold to others; therefore, unless it is shown that the sugar was actually sold, no offence is made out, and mere mens rea does not constitute an offence. The only allegation is that the accused have not maintained records/reports of excess production of sugar and were intending to sell the same; however, such mere intention (mens rea) does not amount to the commission of an
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR offence. Therefore, it is submitted that the complaint is based only on assumption and presumption.
12. It is further submitted that, as per Section 10 of the Karnataka Sugarcane (Regulation of Purchase and Supply) Act, 20136, no Court shall take cognizance of an offence punishable under the said section except upon a complaint made by an officer authorized by the Commissioner for Cane Development and Director of Sugar, and no Court inferior to that of a Magistrate of the First Class shall try such offence. Therefore, the present complaint, having been lodged by the farmers, is not maintainable. It is further submitted that the complaint has not been lodged by an officer authorized by the Commissioner for Cane Development and Director of Sugar, and hence the complaint is not maintainable.
13. It is further submitted that the company has not been made an accused, and unless the company is made an accused, the complaint is not maintainable. As per Section 6 Hereinafter referred to as "Act, 2013"
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR 13 of the said Act, 2013, if any person is to be prosecuted, the company must be arrayed as an accused; otherwise, no prosecution is maintainable directly against the directors, officials, or officers etc., of the factory.
14. It is submitted that the search alleged in the complaint was not conducted by an authorized officer. As per Clause 9-A of the Order, 1966, entry, search, and seizure shall be carried out only by an officer authorized for the said purpose, not below the rank of Police Inspector, Tahsildar, or an officer of equivalent rank, to enter and search any premises where account books, registers, or other documents belonging to or under the control of the producer of sugar are kept. Therefore, the visit and search conducted by the Commercial Tax Department are not authorized.
15. It is further submitted that the provisions of IPC/BNS are not applicable, and there are no specific allegations made against each of the directors, officers, or officials. Unless specific allegations are made against each
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR accused, a complaint containing only omnibus allegations is not maintainable.
16. Therefore, on all the above grounds urged, it is submitted that the complaint is not maintainable, and hence prays to quash the proceedings. In support of his case, reliance has been placed on the following judgments.
i) Sharad Kumar Sanghi Vs Sangita Rane7
ii) Managing Director, Castrol India Limited Vs State of Karnataka and another8
iii) Priyanka Srivastava and Another Vs State of Uttar Pradesh and others9
iv) Ravindranatha Bajpe Vs Mangalore Special Economic Zone Limited and others10
v) Aneeta Hada Vs Godfather Travels and Tours Private Limited11
17. On the other hand, the learned counsel for the respondents/complainants submitted that there are specific 7 (2015) 12 SCC 781 8 (2018) 17 SCC 275 9 (2015) 6 SCC 287 10 (2022) 15 SCC 430 11 (2012) 5 SCC 661
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR allegations made in the complaint that the petitioners/accused have committed the offences alleged. It is further submitted that the argument canvassed by the learned counsel for the petitioners, to the effect that the complaint is not maintainable in view of Section 10 of the Act, 2013, is misconceived, and the said provisions are not applicable to the facts and circumstances of the present case.
18. It is further submitted that the sugar factory, being a legal entity, is under the control of the petitioners/accused, who, being natural persons, are responsible for the day-to-day affairs, transactions, and business of the company/factory, and when the petitioners have acted in a manner detrimental to the interests of the factory, as alleged in the complaint, the complainants, being not only agriculturists but also registered members of the factory, have every right to protect the interests of the factory and have thus lodged the complaint, having locus
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR standi. Therefore, it is submitted that the complaint is maintainable.
19. It is further submitted that 5,084 quintals of excess sugar bags were found, and they were not accounted for, reported, or recorded, and without recording and crediting the same to the accounts of the factory, those excess bags were sold during the period from 14.12.2024 to 10.01.2025, thereby siphoning off an amount of Rs.16-17 crores, which has been usurped by the petitioners/accused, and in this manner, the complaint has been lodged.
20. It is further submitted that there are specific accusations in the complaint that the petitioners, during the said period, have sold excess sugar bags and siphoned usurped the amount between 14.12.2024 and 10.01.2025, and it is also stated in the complaint that the petitioners/accused have robbed an amount of Rs.16-17 crores belonging to farmers who are members of the factory. Therefore, it is submitted that not only mens rea is alleged in the complaint, but also actus reus is made out.
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21. Therefore, it is submitted that a thorough investigation is necessary in this case, and the learned Magistrate has rightly ordered investigation by the police, and at this stage, quashing of the proceedings is not warranted.
22. It is further submitted that the complainants do not have any grievance against the factory; hence, the factory has not been made an accused. It is the petitioners/accused, who are the Chairman, Vice-Chairman, Secretary, Directors, General Manager, and other officials of the factory, who have committed the offences alleged, and their acts are detrimental to the interests of the factory; therefore, they have been made accused.
23. It is further submitted that the complainants, in order to protect the rights and interests of the factory, as several thousands of farmers are dependent on the survival of the factory, have filed the present complaint against those accused who have acted detrimentally to the interests of the factory. Therefore, those responsible for the day-to-
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR day affairs of the factory have been made accused, and hence the complaint is maintainable.
24. It is further submitted that none of the ingredients required for quashing the proceedings by invoking Section 482 of Cr.P.C./Section 528 of BNSS are attracted. Therefore, the petition is not maintainable and is liable to be dismissed, and hence prays to dismiss the petition.
25. In support of his case, reliance has been placed on the following judgments.
i) Dhanraj N Asawani Vs Amarjeetsingh Mohindersingh Basi and others12
ii) Accamma Sam Jacob Vs The State of Karnataka and Anr.Etc.13
iii) Sidram Dhulappa Khatagave and others Vs The State of Karnataka14 12 Crl.A.No.2093/2023, dated 25.07.2023 13 Crl.A.No.____/2026 (Dairy No(s) 20175/2022), dated 13.04.2026 14 Crl.P.No.200872/2025, dated 08.10.2025.
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26. Upon perusal of the complaint, the accusation in the complaint is that the accused are the Chairman, Vice- Chairman, Managing Director, Accounts Manager, etc., who have directly involved in the day-to-day affairs, business, and transactions of the factory. The position of the petitioners in the factory is not disputed. The sum and substance of the complaint is that, during the crushing season 2024-25, upon sugarcane being supplied by the agriculturists to the factory, excess 50,000 quintals of sugar were produced and kept in the godown, and these excess sugar bags were not accounted for or recorded, and the petitioners, having conspired with each other, sold the said excess sugar and siphoned off an amount worth Rs.16-17 crores; this is the gist of the complaint.
27. In the complaint, it is alleged that when the complainants came to know that excess sugar had been produced and that the same was not recorded or reported in the accounts, the accused had usurped the said sugar for their personal gain and siphoned off an amount of Rs.16-17
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR crores, which was meant for the factory. There is a specific allegation in the complaint that the accused have robbed an amount of Rs.16-17 crores belonging to farmers, as per the FRP fixed by the Central Government, which can be found in paragraph No.10 of the complaint. The petitioners have not disputed the fact that the officers of the Commercial Tax Department visited the godown, inspected the same, and found that there were excess 5,084 sugar bags, and that the Commercial Tax Department imposed a penalty for non- accounting, non-reporting, and non-recording of the same, and the accused, being responsible for the affairs of the factory, have immediately paid the penalty of Rs.97,99,410/-.
28. The learned counsel for the respondents/complainants argued that on 23.04.2025, the Commercial Tax Department determined and imposed a penalty of Rs.97,99,410/-, and on the very same day, the accused paid the said penalty. Though some days were stipulated for responding to the notice of penalty, the
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR accused, being responsible for the day-to-day affairs, immediately paid the said penalty of Rs.97,99,410/-, which fortifies the accusation made by the complainants that excess sugar bags were kept in the godown without accounting and reporting the same. Otherwise, if there had been proper reporting, recording, and accounting, there would have been no occasion for immediate payment of the penalty. If the accused had disputed such imposition of penalty, they would have challenged the same; however, it is not done, which prima facie indicates that the offence has occurred as alleged in the complaint. Therefore, in this regard, investigation is required, and at this stage, the investigation cannot be scuttled.
29. The principle of law for invoking Section 482 of Cr.P.C. to quash proceedings has been summarized by the Hon'ble Supreme Court in State of Haryana and Others
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR vs. Bhajan Lal and Others15, at paragraph No. 102, which reads thus:
"102. In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 of the inherent powers under Section 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised.
(1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.15
1992 Supp (1) SCC 335
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same don not disclose the commission of any offence and make out a case against the accused. (4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code.
(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, proving efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with male fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge."
30. There are three parameters enumerated under Section 482 of Cr.P.C./528 of BNSS for quashing the
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR proceedings. But the petitioners has failed to demonstrate how the petition gives effect to the provisions of the Code and has also failed to show what constitutes an abuse of the process of the Court, as well as how the petition aids in securing the ends of justice. Therefore, none of the ingredients required to invoke Section 528 of BNSS (Section 482 of Cr.P.C.) are attracted.
31. Further the provision the Sections 9, 10, 11 and 13 of the Act, 2013 are as follows.
"9. Payment to sugarcane growers.- (1) As soon as sugarcane is supplied to the occupier of a factory, the factory shall be liable to pay the price of sugarcane supplied within fourteen days to the sugarcane growers.
(2) Payment shall be made on the basis of the recorded weight of the sugarcane at the factory. The price of the sugarcane to be payable be calculated to the nearest rupee. (3) An occupier of a factory shall be liable to make for all payments due for sugarcane purchased by him and if such occupier of the factory fails to make payments, the occupier
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR of such factory shall be responsible for making such payments with interest as specified in Sugarcane (Control) Order, 1966 thereon from the date such payment falls due.
10. Penalty.- If any person contravenes any of the provisions of this Act, or any rule made there under, he shall be punishable with rigorous imprisonment for a term which may extend to one year, or with fine which may extend to five thousand rupees or with both.
11. Cognizance of Offence.- No court shall take cognizance of any offence punishable under section 10, except on a complaint made by an officer authorized by the Commissioner for Cane Development and Director of Sugar and no court inferior to that of a Magistrate of First Class, shall try any such offence.
12. XXXX.XXXXX.XXXX...
13. Offences by Companies, Firms and Partnerships:- Where the occupier of a Sugar factory is a Company, Firm or a Partner or a Society or Other Association, any one or more of the partners or members or directors thereof, as the case may be, shall be prosecuted and punished for any offence committed under this Act.
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32. Section 9 of the said Act, 2013 is applicable where the occupier of the factory fails to pay the price of sugarcane to the supplier within 14 days from the date of receipt, in which case penalties under Section 10 and cognizance under Section 11 are attracted. However, in the present case, there is no allegation that the factory has failed to pay the price of sugarcane supplied by the farmers. It is not the allegation in the complaint that the complainants supplied sugarcane and that the factory failed to pay the price. Therefore, Sections 9, 10, and 11 of the Act, 2013 are not applicable.
33. In the present case, the allegation is that upon supply of sugarcane, there was excess production of 50,000 quintals of sugar, and 5,084 excess bags were found, but without accounting and reporting the same or crediting the accounts of the factory, the same were sold to third parties, and the sale proceeds of about Rs.16-17 crores were misappropriated by the accused. Therefore, Sections 9, 10,
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR and 11 of the Act, 2013 are not applicable, and in this regard, the submission of the learned counsel for the respondents is correct.
34. Further, Section 13 of the Act, 2013 is not applicable for the reason that there is no allegation against the factory as such that it has committed any offence. Therefore, Section 13 of the Act, 2013 is also not applicable, and the submission made by the learned counsel for the petitioners is devoid of merit.
35. As regards the submission that the company has not been made an accused and hence the complaint is not maintainable, upon perusal of the complaint, there is no allegation that the company/factory itself has committed any offence. As discussed above, the complainants have not expressed any grievance against the company/factory, but have instead sought to protect its interests. The grievance of the complainants is against the petitioners, who, being responsible for the day-to-day affairs, business, and transactions of the factory, have acted detrimentally to its
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR interests and caused loss to the factory and farmers by committing offences such as fraud and cheating. Therefore, the non-impleadment of the company/factory is not a ground to hold that the complaint is not maintainable.
36. Considering the submission regarding clause 9-A of the Order, 1966, it is applicable where entry, search, and seizure are required in respect of accounts, books, registers, or documents not maintained or not kept in safe custody. However, in the present case, it is not alleged that such records were not maintained or kept safely. The allegation is that excess sugar was produced but not accounted for, which amounts to evasion of tax. In such circumstances, the tax authorities have every power to inspect and search the premises. In the present case, the Commercial Tax Department conducted inspection, found excess sugar bags, and imposed a penalty for tax evasion. Therefore, Order 9-A is not applicable.
37. The fact that the petitioners paid the penalty on the very same day indicates prima facie that excess sugar
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NC: 2026:KHC-D:6353 CRL.P No. 104513 of 2025 HC-KAR bags were found. In this regard, investigation is required to ascertain whether the excess production was accounted for and what loss has been caused to the factory and its members. Therefore, complaint requires investigation of offence occurred and no abuse of process of Court is made out thus the petition is liable to be dismissed.
38. Where the complaint discloses a prima facie case, investigation is necessary to ascertain the truth. In the present case, the complaint alleges not only mens rea but also actus reus, namely excess production, non- accounting, and sale of sugar bags, and siphoning of Rs.16- 17 crores. Therefore, a prima facie case is made out.
39. Accordingly, when a prima facie case is made out, investigation is required, and the same has been rightly ordered by the learned Magistrate. There is no abuse of process of Court. Hence, the petition is liable to be dismissed.
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40. The rulings relied upon by the learned counsel for the petitioners are not applicable, as the factual matrix of those cases differs from the present case. Therefore, the decisions relied upon are not applicable.
41. For the aforesaid reasons, the petition is liable to be dismissed, and accordingly, it is dismissed.
The observations made herein are solely for the purpose of adjudicating the present petition and shall not, in any manner, influence or affect the merits of the trial. Liberty is granted to the petitioners to urge all grounds raised in the present petition during the course of the trial. The trial Court shall consider the same on merits and pass appropriate orders in accordance with law.
In view of the disposal of the petition, pending I.As, if any, shall also stand disposed of as does not survive of consideration Sd/-
(HANCHATE SANJEEVKUMAR) JUDGE ASN /CT-AN List No.: 2 Sl No.: 68