Karnataka High Court
M/S Sri Avatika Contractors (I) Ltd And ... vs The Inspector Of Police on 23 December, 2021
Author: H.P.Sandesh
Bench: H.P.Sandesh
1
IN THE HIGH COURT OF KARNATAKA
KALABURAGI BENCH
DATED THIS THE 23 RD DAY OF DECEMBER 2021
BEFORE
THE HON'BLE MR. JUSTICE H.P.SANDESH
WRIT PETITION No.200441/2021 (GM-RES)
CONNECTED WITH
WRIT PETITION No.200439/2021 (GM-RES)
IN W.P.NO.200441/2021
BETWEEN:
SRI. K ANDREW VINCENT
S/O LATE I. KALANDAIYESU
AGED ABOUT 50 YEARS
PROPRIETOR OF M/S PENTAGON SURVEYS
HAVING OFFICE AT. NO. 1888, 7TH A MAIN ROAD
E-BLOCK, 2ND STAGE, RAJAJINAGAR
BENGALURU-560010.
R/AT NO. 3672, 5TH MAIN
GAYATRINAGAR
BENGALURU-560021.
... PETITIONER
(BY SRI B.V. ACHARYA, SR. ADVOCATE A/W
SRI AMRESH S ROJA, SRI MAYUR GADADAM D.S. AND
SRI K. KUMAR, ADVOCATES)
AND
1. THE INSPECTOR OF POLICE
CENTRAL BUREAU OF INVESTIGATION
ANTI-CORRUPTION BRANCH
2
GANGANAGAR
BENGALURU 560032.
2. NTPC LIMITED
NTPC BHAVAN, SCOPE COMPLEX
R/O.NO.7, INSTITUTIONAL AREA
LODHI ROAD, NEW DELHI-110003
REP BY ITS: MANAGER DIRECTOR
RESPONDENTS
(BY SRI PRASANNA KUMAR, ADVOCATE R1
SRI D.P.AMBEKAR, ADVOCATE FOR R2)
WRIT PETITION UNDER ARTICLE 226 AND 227 OF
CONSTITUTION OF INDIA R/W SECTION 482 OF THE CODE
OF CRIMINAL PROCEDURE, 1973 PRAYING TO ISSUE WRIT
IN THE NATURE OF CERTIORARI OR OF ANY OTHER NATURE
QUASHING THE ORDER DATED 20.01.2021, PASSED BY THE
SR. CIVIL JUDGE AND JMFC, BASAVANA BAGEWADI, TAKING
COGNIZANCE AND ISSUING SUMMONS TO THE PETITIONER
WHO IS ARRAYED AS ACCUSED NO.1, FOR THE OFFENCES
PUNISHABLE UNDER SECTIONS 120-B R/W 420, 468, 472
AND 511 OF IPC PENDING ON THE FILE OF THE SR. CIVIL
JUDGE AND JMFC, BASAVANA BAGEWADI AS AGAINST THIS
PETITIONER WHO IS ACCUSED NO.2, PRODUCED VIDE
ANNEXURE-'A' AND ETC.
IN W.P.NO.200439/2021
BETWEEN:
M/S SRI AVANTIKA CONTRACTORS (I) LTD
REPRESENTED BY ITS MANAGING DIRECTOR
SRI K.NARENDRAREDDY
S/O LATE VENKATARAMANAREDDY
HAVING OFFICE AT NO. 401/A-WING
DO. NO. 6-3-352/2 & 3 HEIGHTS COMPLEX
HYDERABAD-500034.
3
PRESENT ADDRESS BEING:
DOOR NO. 8-2-603/23/3 & 15
3RD FLOOR, HSR SUMMIT
BESIDE NO.1, NEWS CHANNEL
ROAD NO. 10, BANJARA HILLS
HYDERABAD-500034.
... PETITIONER
(BY SRI B.V.ACHARYA SR. ADVOCATE A/W
SRI AMAR CORREA, SMT. SHRIDEVI BHOSHE AND
SRI RAMACHANDRA SHENOY, ADVOCATES)
AND
1. THE INSPECTOR OF POLICE
CENTRAL BUREAU OF INVESTIGATION
ANTI-CORRUPTION BRANCH
GANGANAGAR
BANGALORE-560 032.
2. NTPC LIMITED
NTPC BHAVAN, SCOPE COMPLEX
R/O.NO.7, INSTITUTIONAL AREA
LODHI ROAD, NEW DELHI-110003
REP BY ITS: MANAGER DIRECTOR
... RESPONDENTS
(BY SRI PRASANNA KUMAR, ADVOCATE R1
SRI D.P.AMBEKAR, ADVOCATE FOR R2)
WRIT PETITION UNDER ARTICLE 226 AND 227 OF
CONSTITUTION OF INDIA R/W SECTION 482 OF THE CODE
OF CRIMINAL PROCEDURE, 1973 PRAYING TO ISSUE WRIT
IN THE NATURE OF CERTIORARI OR OF ANY OTHER NATURE
QUASHING THE ORDER DATED 20.01.2021, PASSED BY THE
SR. CIVIL JUDGE AND JMFC, BASAVANA BAGEWADI, TAKING
COGNIZANCE AND ISSUING SUMMONS TO THE PETITIONER
WHO IS ARRAYED AS ACCUSED NO.1, FOR THE OFFENCES
PUNISHABLE UNDER SECTIONS 120-B R/W 420, 468, 472
AND 511 OF IPC PENDING ON THE FILE OF THE SR. CIVIL
JUDGE AND JMFC, BASAVANA BAGEWADI AS AGAINST THIS
4
PETITIONER WHO IS ACCUSED NO.1, PRODUCED VIDE
ANNEXURE-'A' AND ETC.
THESE PETITIONS HAVING BEEN HEARD AND
RESERVED FOR ORDERS ON 15.12.2021, THIS DAY, THE
COURT PRONOUNCED THE FOLLOWING:
ORDER
These two petitions are filed under Article 226 of the Constitution of India read with Section 482 of Cr.P.C. praying this Court to:
(i) issue a writ in the nature of certiorari to quash the order dated 20.01.2021 passed by the Senior Civil Judge and JMFC, Basavana Bagewadi taking cognizance and issuing summons to the petitioner who is arrayed as accused No.1 for the offences punishable under Sections 120B read with 420, 468, 472 and 511 of IPC as against accused Nos.1 and
2 respectively;
(ii) issue a writ in the nature of certiorari to quash the entire proceedings in C.C.No.12/2021 (arising out of RC.15(A)/2017 CBI ACB BLR) for the offences punishable under Sections 120B read with 420, 468, 472 and 511 of IPC pending on the file of Senior Civil Judge and JMFC, Basavana 5 Bagewadi as against accused Nos.1 and 2 respectively;
(iii) issue a writ of certiorari to quash the FIR dated 27.08.2017 in RC.15(A)/2017 registered by the respondent CBI and charge sheet pending in C.C.No.12/2021 for the offences punishable under Sections 120B read with 420, 468, 472 and 511 of IPC pending on the file of Senior Civil Judge and JMFC, Basavana Bagewadi as against accused Nos.1 and 2 respectively.
2. The factual matrix of the case is that the petitioner/accused No.1 in W.P.No.200439/2021 is the Company M/s Sri Avantika Contractors (I) Limited (SACIL), represented by its Managing Director and the petitioner/accused No.2 in W.P.No.200441/2021 is the Proprietor of M/s Pentagon Surveys. The case of the respondent No.1-CBI that the respondent No.2 - National Thermal Power Project (NTPC) during the year 2012-13 was entrusted the work of site leveling to M/s Sri Avantika Contractors (I) Limited i.e., accused No.1 and in turn the 6 accused No.1 entrusted the work of survey the same to the accused No.2.
3. The respondent No.2-NTPC is the public sector undertaking engaging the business of generation of electricity and allied activites, awarded the work of Site Levelling and Infrastructure Works Package for its Kudgi Super Thermal Power Project Stage-I (3x800 MW), Karnataka to the accused No.1 and in terms of the contract, an agreement was executed on 02.04.2012 for the value of work an amount of Rs.154,34,54,426/-. The scheduled period for completion of the work was 30 months started from 27.02.2012 and the completion on 26.08.2014. Subsequently, contract value was increased to Rs.183.54 crore and again the same was increased to 189.03 crore. Though 30 months time was fixed, there were various reasons for the delay hence, the said work could not be completed and the respondent No.2 granted an extension of six months up to February 2015. Certain disputes arose between the parties regarding the initial levels and the quantities in the RA bills, leading to the 7 termination of the contract by NTPC on 24.03.2014. The contract (GCC) provided that Dispute Settlement Clause and several disputes that arose were referred to the Dispute Resolution Board (DRB). As the decision of the DRB was not acceptable to both the parties, the parties resorted to the clause that provided for Dispute Settlement Mechanism under the Contract and according to which the dispute has been agreed to be resolved through Arbitration consisting of a panel of three Member Arbitral Tribunal. The accused No.1 presented claim for 36 items for the total amount of Rs.139.14 crore. The accused No.2 made a counter claim for 16 items. The Arbitration Tribunal by its arbitral award dated 07.07.2017 accepted five claims of the petitioner No.1 company and awarded an amount of Rs.50,21,54,497/- and rest of the claims were rejected and interest at 14% per annum was awarded. As regards claims of NTPC, Tribunal accepted four of their counter claims and rejected the rest of the claims and awarded an amount of Rs.2,67,23,699/-. Upon setting off the claim awarded to the petitioner company as against the counter 8 claim award to NTPC, it was held that an amount of Rs.47,54,30,798/- was due by NTPC to the petitioner company. The said award is marked as Annexure-D. The charge sheet, FIR and the order sheet for having taken the cognizance are marked as Annexures- A to C. The said award has been challenged before the Single Judge at Delhi High Court and Delhi High Court confirmed the award passed by the Arbitration. In the meanwhile, the respondent No.1-CBI based on the source information investigated the matter and filed the charge sheet after the Arbitral award. The case has been registered against the accused No.1 and also against the officials of the NTPC in R.C.15(A)/2017 CBI ACB BLR and issued FIR in terms of Annexure-B and suspected offences are criminal conspiracy, cheating, using forged documents as genuine falsification of accounts, criminal misconduct by the public servant. Wherein the accused No.1-M.V.Padmakumar, Senior Manager (Civil), NTPC, S.S.Nathan-accused No.2 AGM (Safety), retired, NTPC and V.K.Pradhan-accused No.3, General Manager (Project), NTPC and the accused 9 No.1 arrayed as accused No.4 and also against the non- officials of NTPC and others. The CBI after the investigation filed the charge sheet under Section 173(2) of Cr.P.C., against the accused No.1 and accused No.2 and another accused No.3 the then Project Managers of the accused No.1 company and left out the original accused i.e., accused Nos.1 to 3 in FIR. The charges leveled against these petitioners that two sets of records are prepared, one with actual measurements and second one with inflated quantities/measurements and signed second set of site level records which facilitated M/s SACIL in using the said fabricated records to submit highly inflated false bills to the tune of Rs.45.15 crore and based on the said fabricated data made subsequent arbitration claim for Rs.57.06 crore, after NTPC finally terminated the contract with them.
4. The investigation reveal that two sets of ground level data submitted by M/s. SACIL i.e., accused No.1 company is fabricated and brief of the fact that in the NTPC, original ground levels data bear the signatures of 10 some of the officials of NTPC but there is no any role of the said officials of the NTPC and though the signatures are obtained fraudulently by the accused No.1, it is also an allegation against the accused No.2 that in collusion with the accused No.1 got surveyed the land and measured by the surveyor who is authorised surveyor of M/s SACIL and hence, invoked the above offences.
5. The counsel appearing for both the petitioners have vehemently contended that the contract agreement was entered between the accused No.1 and NTPC on 02.04.2012 and the same was terminated on 24.03.2014 and the matter was referred to three Members panel Arbitration and both of them have made the claim on 23.01.2016 and after due enquiry, the Tribunal, unanimous award has been passed on 07.07.2017 considering the claim of both the parties. The very contention of the counsel for the petitioners that after 100 days of the award and more than 3½ years after the dispute started, CBI suo motu on the basis of the source information, registered the FIR against some of the 11 officials of NTPC and the accused No.1 invoking the offence under Section 120(b), 420, 468, 471, 477(A) of IPC and under Section 13(2) read with Section 13(1)(d) of PC Act but there was no reference to arbitral award whatsoever. The counsel would submits that NTPC challenged the award before the Delhi High Court invoking Section 34 of the Arbitration and Reconciliation Act and the Delhi High Court after hearing both the parties, dismissed the petition filed by the respondent No.2 and confirmed the award passed by the Arbitral Tribunal and uphold the same as genuine. NTPC has filed the appeal before the Division Bench which is pending for consideration. The counsel also would vehemently contend that CBI filed the final report before the learned Magistrate exonerating the officials of NTPC for all the offences including Section 13(2) of the PC Act as it named in the FIR and only against accused No.1 and accused No.2 filed charge sheet and the learned Magistrate took the cognizance. The counsel vehemently contented that the dispute between the parties before the Arbitral Tribunal is regarding the measurement 12 recorded in Original Ground Level Data. The petitioner company has relied on the data sheets signed by the authorised representatives of NTPC and other engineers as also by the authorised representatives of the company. The NTPC relied upon the measurement data sheets signed by their various representatives and other officials as also by one Augustin who is admittedly not an authorised representative of the company who was a only helper to the survey team. After detailed scrutiny and discussions, the Arbitral Tribunal accepted the measurement data sheets relied upon by the company-accused No.1. The grievance of NTPC was with regard to finding of fact recorded by the Arbitral Tribunal and the learned Single Judge of Delhi High Court concurred with the finding recorded by Arbitral Tribunal. The dispute between the parties are purely on civil in nature and the matter has been adjudicated upon by the Arbitral Tribunal with the consent of both the parties and the same have been upheld by the learned Single Judge of the Delhi High Court and invoking of criminal prosecution belatedly that too by 13 the action of CBI and exonerating the NTPC officials under Section 13 of the PC Act and filing of the present charge sheet against the petitioners is nothing but an abuse of process of law.
6. The counsel vehemently contended that the FIR registered after the Arbitral award and charge sheet was filed only after the appeal was filed before the Division Bench. The counsel would vehemently contend that the civil dispute between the parties is a contractual dispute but given the criminal colour that too after passing the Arbitral award consisting of three Members panel. The counsel also would vehemently contend that the CBI action was based on the malafide source information that too help respondent No.2, CBI took up the investigation. It is nothing but colourable exercise of powers by CBI. The FIR is filed with the object of nullifying the Arbitral award and even Delhi High Court also confirmed the award passed by the arbitrator. The learned Magistrate has not applied its mind while taking the cognizance and failed to take note of the fact that the other officials of NTPC are exonerated. 14 The offences which have been invoked against the petitioners does not attracts any of the ingredients of those offences and investigation conducted by the CBI is one sided investigation. The counsel also would vehemently contended that FIR has been registered at the first instance against the officials of the NTPC as there was no complaint by NTPC. But only on the basis of source information, if there is any dispute between the parties, the same has to be considered only by the Arbitrator in terms of the contract. Civil disputes already before the arbitrator and arbitrators also decided the claim of both the parities and when such being the case, ought not to have been invoked the criminal prosecution and arbitrators are also qualified engineers and even second set of documents filed by the company are also signed by the officials of NTPC. The counsel also vehemently contend that when Section 13 of PC Act was not invoked, the CBI will not get any jurisdiction to investigate the matter and Section 13 of PC Act invoked only to invoke the jurisdiction of CBI. The other petitioner i.e., the accused No.2 is only 15 the surveyor and the said work was entrusted by the accused No.1 and carried out the survey work and the same has been accepted by both the company and counter signed by the NTPC. When such being the case, there cannot be any criminal prosecution.
7. The counsel appearing for the petitioner also relied upon the judgment of Sardool Singh and Another vs Smt. Nasib Kaur reported in 1987 (SUPP) SCC 146 wherein the Apex Court held that when the question regarding validity of Will is sub judice, criminal prosecution on the allegation of the Will being a forged one cannot be instituted. Genuineness or otherwise of the Will in question as there is no occasion to do so and the question is wide open before the lower courts and quashed the criminal proceedings pending in the Court of the jurisdictional magistrate. The counsel also relied upon the judgment reported in AIR 1988 SC 709 between Madhavrao Jiwaji Rao Scindia and Another vs Sambhajirao Chandrojirao Angre and Others wherein also the Apex Court held that alleged breach of trust 16 constituting only civil wrong and quashed the proceedings. The counsel also relied upon the judgment of Inder Mohan Goswami and Another vs State of Uttaranchal and Others reported in (2007) 12 SCC 1 wherein also the Apex Court held that when the issues involved are of such magnitude that they cannot be seen in their true perspective without sufficient material yet no hard and fast rule can be laid down for exercise of extraordinary jurisdiction under Section 482 of Cr.P.C. The counsel also relied upon the paragraph 37 referring the case of Indian Oil Corpn vs NEPC India Ltd., and again cautioned about a growing tendency in business circles to convert purely civil disputes into criminal cases and in paragraph 23 also discussed the scope and ambit of courts' powers under Section 482 of Cr.P.C. The Apex Court in the judgment in paragraph 46 also held that the Court must ensure that criminal prosecution is not used as an instrument or harassment or for seeking private vendetta or with an ulterior motive to pressurise the accused. The counsel also relied upon the judgment reported in (2018) 17 13 SCC 374 between Medmeme, LLC and Others vs Ihorse BPO Solutions Private Limited wherein also the Apex Court with regard to Section 482 of Cr.P.C., held that filing of a criminal complaint against the appellants alleging that the appellants had committed the offences of cheating and misappropriation punishable under Sections 420, 406, 409 read with Section 120-B of IPC and the complaint gave a clear impression that it was primarily a case where the respondent had alleged breach of contract on the part of the appellants in not making the entire payments for the services rendered, the Court can exercise the powers under Section 482 of Cr.P.C.
8. The learned counsel also relied upon the judgment of the Hon'ble Apex Court in the case of Vinod Natesan vs. State of Kerala and others reported in (2019)2 SCC 401 wherein the Hon'ble Apex Court discussed with regard to exercising power under Section 482 of Cr.P.C.,- quashment of complaint when dispute is essentially civil in nature and did not disclose elements of crime and brought to the notice of the Court paragraph-10 18 of the judgment wherein in detail discussion was made with regard to the dispute.
9. The learned counsel relied upon the judgment of the Hon'ble Apex Court in the case of Sunil Bharti Mittal vs. Central Bureau of Investigation reported in (2015)4 SCC 609 wherein the Hon'ble Apex Court discussed that when company is the accused, its Directors can be roped in only if there is sufficient incriminating evidence against them coupled with criminal intent and brought to the notice of the Court paragraphs-31 and 54.
10. The learned counsel also relied upon the judgment of the Hon'ble Apex Court in the case of Randheer Singh vs. State of U.P. and others reported in 2021 SCC Online SC 942 and brought to the notice of this Court paragraph-34 wherein it is held that the given set of facts may make out a civil wrong as also a criminal offence. Only because a civil remedy is available may not be a ground to quash the criminal proceedings. But when 19 no criminal offence is made out in the FIR read with the charge sheet, the Court can exercise power for quashing.
11. The learned counsel also relied upon the judgment of the Hon'ble Apex Court in the case of Mitesh Kumar J. Sha vs. State of Karnataka and others reported in 2021 SCC Online SC 976 and brought to the notice of this Court paragraph-47 wherein the Hon'ble Apex Court has observed that at innumerable instances expressed its disapproval for imparting criminal color to a civil dispute, made merely to take advantage of a relatively quick relief granted in a criminal case in contrast to a civil dispute. Such an exercise is nothing but an abuse of the process of law which must be discouraged in its entirety.
12. Per contra, learned counsel for respondent No.1/CBI vehemently contended that attempt was made to defraud respondent No.2 and two sets of records were placed, one set of records are admitted and second set of documents are fabricated by accused Nos.1 and 3 with the 20 help of accused No.2. The learned counsel brought to the notice of this Court the charges made in the charge sheet and when the documents are fabricated, it is a matter of trial and it is not of contractual breach. No finding was given by Arbitral Tribunal with regard to fabrication and so also learned Single Judge. The arbitral award finding is that it is contractual obligation and not discussed anything about fabrication. The criminal prosecution initiated for fabrication of documents and no case is made out to invoke Section 482 of Cr.P.C. The judgments which have been relied upon by the learned counsel for the petitioners are not applicable to the case on hand and the same are in respect of strained relationship and when the arbitration was pending. But here is the case of fabrication and hence, proceedings cannot be quashed.
13. The learned counsel for respondent No.2 vehemently contended that Arbitration Act is not applicable when the Evidence Act is not applicable to the same. The learned counsel brought to the notice of this Court Section 3 of the Evidence Act and submits that Arbitrator is 21 exempted and whether award is admissible or not is question before the Court and under the Evidence Act, Arbitrator cannot discharge his duties in consonance with the Evidence Act. He also brought to the notice of this Court Sections 40 to 44 of the Evidence Act and submits that the arbitration award is not judgment in rem and the same is also not conclusive proof. The Arbitrator is not a Court. When such being the case, the very contention of the petitioner that arbitration award is pending before the Court for consideration and hence, there cannot be any criminal prosecution cannot be accepted. The arbitration is only for limited purpose and power under the arbitration appeal is also very limited. This Court cannot look into the finding of the arbitration award. Both the actions are distinct and criminal acts are found only after verification. NTPC is a Central Government undertaking and there is loss of Rs.47.00 crores if the criminal prosecution is quashed and jurisdiction of the trial Court cannot be scuttled by quashing the proceedings invoking Section 482 of Cr.P.C.
22
14. In reply to the arguments of the learned counsel for respondent Nos.1 and 2, the learned counsel for the petitioners brought to the notice of this Court clause-7.3 of the agreement between the parties and submits that dispute is only with regard to the data of the work done in respect of ground level and actual measurement has to be tested by the Arbitrator only and not by criminal Court. The learned counsel also submitted that authorized signatory Praveen of NTPC has signed the documents and dispute is also considered by the Arbitrator and documents are signed by both the parties. He also submitted that only IPC offences are invoked and not the PC Act offences. When such being the case, CBI has no power to investigate the matter and Prevention of Corruption Act only invoked to book these petitioners and ultimately exonerated the officials of NTPC. When such being the case, it amounts to colorable exercise of powers without reference to the award and the Court has to take note of the timings of the initiation of the criminal prosecution i.e., after the award, the case is also 23 registered after filing the appeal before the High Court and in order to over-reach the finding, criminal law was set in motion. When NTPC failed before the Arbitrator filed criminal case with the aid of CBI and hence, it requires interference by exercising power under Section 482 of Cr.P.C., or otherwise it amounts to abuse of process and it leads to miscarriage of justice.
15. In reply to the arguments, learned counsel for respondent No.2 submits that decision of arbitration is only with respect to civil dispute and not with respect to criminal prosecution.
16. Having heard the learned counsel for the petitioners and the learned counsel appearing for respondent Nos.1 and 2 in both the cases and having considered the material on record, the point that would arise for consideration of this Court is, Whether initiation of criminal prosecution against the petitioners is an abuse of process in respect of contractual dispute between the 24 parties by giving criminal colour to the civil dispute as contended by both the petitioners?
17. Having heard the learned counsel appearing for the respective petitioners and the learned counsel appearing for the respondents, there is no dispute between the parties that there was contract agreement between M/s. Avantika Contractors and NTPC and estimated cost is Rs.189 crores. Both the counsels not disputed the contract agreement dated 02.04.2012. It is also not in dispute that the contract was terminated by respondent No.2 on 24.03.2014. It is also not in dispute that the matter was referred to a three Members Panel Arbitration on 23.01.2016. The dispute was also with respect to Original Ground Level Data, each party relying on conflicting data sheets. There is no dispute with regard to first set of documents. The dispute is only with regard to R.A.Bill No.15 claiming that those documents are fabricated documents. The said issue of documents are fabricated in second set of documents is also raised before the Arbitrators. The Arbitrators taking into note of the material 25 on record allowed the claim of accused No.1-company partly as well as respondent No.2/NTPC claim partly. It is also not in dispute that CBI registered FIR on the basis of source information arraying first three accused persons as officials of respondent No.2/company. FIR was registered on 27.08.2017. It is clear that arbitration award was passed on 07.07.2017 wherein the NTPC only got claim to the extent of Rs.2,67,23,699/- and as against accused No.1/company got Rs.47,54,30,798/-, difference is huge. Admittedly, FIR is registered after three and half years of the dispute started i.e., in the year 2014. Immediately after the dispute is started no criminal compliant is filed by the NTPC, instead after Arbitral Award, FIR was registered i.e., after more than three and half years of the dispute and that too no complaint is given by respondent No.2, but suo-moto case is registered by respondent No.1 on the basis of source information. First of all, the claim was made based on R.A.Bill No.15 relating to second set of documents, the same is also with regard to measurement and contract was also terminated on 24.03.2014 by 26 respondent No.2. It is not in dispute that there was a contract agreement between M/s Avantika Contractors (I) Ltd., and NTPC and there is clause in the agreement dated 02.04.2012 that if any dispute arises between the parties, the same has to be referred to Arbitrators. It is also important to note that based on the said documents, a claim was made and for a period of three years no complaint was given. The complaint was given only after NTPC has suffered order passed by the three Arbitrators who have been appointed by both the parties. The said issue of claim based on the second set of documents and the said claim made during arbitration and the arbitrators have given an unanimous finding and considered the claim of both accused No.1 as well as respondent No.2. It is also important to note that the said arbitration award was also challenged before the learned Single Judge i.e., on 13.10.2017 and suo moto case was registered on 27.10.2017 after fourteen days of filing appeal invoking Section 34 of the Arbitration and Reconciliation Act. The learned single Judge also confirmed the award passed by 27 the Arbitrator. First of all, it is clear that there was contract agreement between the parties and also there is recital in the agreement that if there is any dispute the same shall be referred to the Arbitrators and accordingly, the matter was also referred to the Arbitration in the year 2016 itself and hence, it is clear that after suffering an award by the Arbitrators, respondent No.1 set up for criminal prosecution against the petitioners herein at the instance of respondent No.2. It is also claim of respondent No.1 that no complaint is given, but they investigated the matter based on the source of information. It is also important to note that respondent No.1 registered the case against the officials of NTPC arraying them as accused Nos.1 to 3. But only arrayed accused No.4 in the FIR as accused No.1 in the charge sheet, but exonerated accused Nos.1 to 3 who have been arrayed as accused Nos.1 to 3 in the FIR. It has to be noted that allegation against the petitioners herein that they indulged in creation of documents along with accused Nos.1 to 3 of FIR. But admitted fact is that authorized representatives of 28 respondent No.2/company have countersigned those documents and when those officials who have arrayed as accused Nos.1 to 3 in the FIR were exonerated, how come these petitioners become accused and committed offence of creation of documents and forgery when the counter signed officials of NTPC officials are exonerated. Hence, it is clear that these petitioners have been arrayed as accused only with malafide intention. Though the offences under the Prevention of Corruption Act are invoked in the FIR, the same was not pressed into service, but only IPC offences are invoked against only these petitioners. It is also not in dispute that the NTPC officials who have signed those documents have been exonerated and the offences of creation of documents are invoked only against these petitioners and officials of NTPC are given clean chit, hence, the same is nothing but an abuse of process. Apart from that, when the matter was referred to the Arbitrator, an arbitration award was suffered by respondent No.2 and thereafter only after thought through respondent No.1 criminal prosecution is initiated and subsequently suffered 29 an order from the Delhi High Court confirming the arbitration award. It is also pertinent to note that the charge sheet was filed subsequently when the matter is pending before the Division Bench i.e., on 22.12.2020. When they failed to succeed before the Arbitration as well as before the Single Bench at Delhi High Court, the charge sheet was filed on 22.12.2020 when the appeal filed by respondent No.2 was pending before the Division Bench. The issue of second set of documents was also considered before the Arbitrators. The very contention of learned counsel for respondent No.2 that the Evidence Act is not applicable and hence, offences under the Penal provisions cannot be decided by the Arbitrator cannot be accepted for the reason that it is nothing but giving criminal color to the civil dispute between the parties that too dispute is in respect of only measurement and NTPC officials are also countersigned those documents and hence, question of fabrication of documents does not arise. I have already pointed out, when the officials of the NTPC are also part of the documents of second set which is claim made in 30 respect of R.A.Bill No.15, there cannot be two yardsticks exonerating the officials of respondent No.2 and registering the case against petitioners herein. Hence, there is force in the contention of the learned counsel for the petitioners that it is nothing but colourable exercise of power by the CBI in respect of the civil dispute and action of respondent No.1 is nothing but malafide intention and only to help respondent No.2, the criminal prosecution is initiated against the petitioners herein, as contended by the learned counsel for the petitioners. The principles laid down in the judgments referred to by the learned counsel for the petitioners are aptly applicable to the case on hand. The Hon'ble Apex Court in Maksud Saiyed vs. State of Gujarat and Others reported in 2008(5) SCC 668 held that initiation of criminal prosecution is a serious matter. The judgment referred by the petitioners counsel wherein held that it is nothing but giving criminal colour to the civil dispute between the parties and there was delay in initiating criminal prosecution and that too the same has been initiated through CBI only based on some information 31 and not on any complaint by respondent No.2. It is also undisputed fact that respondent No.2 is a Central Government Undertaking and hence, it is clear that with malafide intention criminal prosecution is initiated through respondent No.1 and further exonerated the officials of the respondent No.2 and only initiated criminal prosecution against the petitioners. The same fortifies the contention of the petitioners herein. Hence, very initiation of criminal prosecution requires to be quashed by invoking Section 482 of Cr.P.C., otherwise it amounts to abuse of process which leads to miscarriage of justice.
18. Apart from that, when the charge sheet was filed, the learned Magistrate also not applied his mind and mechanically passed an order saying that perused the documents and whether the charge sheet material and its enclosures disclose prima facie case or not, nothing is discussed and whether material collected by respondent No.1 disclose prima facie case or not to proceed with the case, no order has been passed and mechanically took cognizance. Hence, the order of taking cognizance is also 32 required to be interfered with by this Court when there is no judicious application of mind by the learned Magistrate. Hence, the petitioners are entitled for the relief as sought in the respective petitions.
19. In view of the discussions made above, I pass the following:
ORDER The writ petitions are allowed.
The order of taking cognizance passed by the Senior Civil Judge and JMFC, Basavana Bagewadi vide order dated
20.01.2021 in C.C.No.12/2021 is hereby quashed in respect of the petitioners by issuing writ of certiorari and so also by issuing writ in the nature of certiorari quashed the entire proceedings in C.C.No.12/2021 (arising out of RC.15(A)/2017 CBI ACB BLR) pending on the file of Senior Civil Judge and JMFC, Basavana Bagewadi, in respect of the petitioners. Consequently, FIR in RC.15(A)/2017 dated 27.08.2017 registered by respondent/CBI and chargesheet in C.C.No.12/2021 (arising out of 33 RC.15(A)/2017 CBI ACB BLR) is also quashed in respect of the petitioners.
Sd/-
JUDGE SAN/NB*