Court No. - 33
Case :- CRIMINAL MISC. WRIT PETITION No. - 11132 of 2019 Petitioner :- Wealth Mantra Limited And Another Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Niraj Tiwari,Sheelu Jaiswal Counsel for Respondent :- G.A.
Hon'ble Manoj Misra,J. Hon'ble Suresh Kumar Gupta,J.
Heard learned counsel for the petitioners; learned A.G.A. for respondents 1, 2 and 3; and perused the record.
The instant petition seeks quashing of the First Information Report dated 28.05.2018 registered as Case Crime No.486 of 2018, under Sections 420, 467, 468, 471 and 506 I.P.C., at Police Station - Sadar Bazar, District Shahjahanpur.
The allegation in the impugned first information report, which has been lodged by respondent no.4, is that Wealth Mantra Limited (petitioner no.1) was a broker member of the National Stock Exchange of India Ltd. It invited sub brokers to deal through its account. The informant had been one of the sub brokers of the petitioner no.1. The allegation is that the informant's clients, that is 182 investors, had their shares, valued at about 3 crores, lying in the pool account of the member which, by fabrication of documents, were misappropriated. It is alleged that in addition to that Rs. 9,50,000/- lying in the account for share purchase was also swindled by fabrication of documents.
From the record (Annexure-2 at page 51) it appears that M/s Wealth Mantra Limited was expelled by the National Stock Exchange on 13.4.2018. The sub-brokers affiliated to it were advised not to deal henceforth through the said member and claims were invited within three months from all concerned against the said expelled member (Wealth Mantra Limited).
The contention of the learned counsel for the petitioners is, firstly, that there is an arbitration clause in the agreement between the member company and the sub-brokers and, therefore, parties can take recourse to the arbitration clause for settlement of the dispute; and, secondly, there has already been settlement with some of the investors and the impugned first information report is, therefore, liable to be quashed.
In so far as the contention that there exists an arbitration clause therefore parties can settle their disputes through arbitration is concerned, it may be observed that it is well settled legal principle that an arbitration clause between the parties would not oust jurisdiction of criminal courts to proceed with prosecution nor it will annul penal action against a party to an agreement for arbitration.
In respect of the above proposition of law, regard may be had to decision of Hon'ble Apex Court in the case of S.W. Palanitkar v. State of Bihar, (2002) 1 SCC 241; and State of Orissa v. Ujjal Kumar Burdhan, (2012) 4 SCC 547 wherein it has been held that remedy of arbitration is no bar to criminal prosecution.
As regards the second submission of learned counsel for the petitioners that parties have already settled their dispute, suffice it to say that firstly, it is a pure question of fact which the petitioners can always place before the Investigating Officer by supporting documents, upon which, it is expected that the Investigating Officer shall verify and take it into account while submitting a police report. Secondly, and most importantly, as of now, there is no cogent material brought on record to demonstrate that all 182 investors of the informant (sub-broker) have settled their dispute.
At last, the learned counsel for the petitioners by placing reliance on the order dated 25.04.2019 passed in Criminal Misc. Writ Petition No.10802 of 2019 submitted that co-accused Sunita Agrawal has been granted protection till submission of police report under Section 173(2) Cr.P.C. therefore similar protection be provided to the petitioners.
We have perused the order dated 25.04.2019. In that order the Court has not discussed the facts of the case and has not dealt with the allegations though the Court had rejected the prayer to quash the FIR. It appears to be a protection order granted on the facts peculiar to the petitioner Sunita Agrawal. Further, it appears that Sunita Agrawal must have been implicated being just a Director of the defaulter company (petitioner no.1), whose managing director is the petitioner no.2 (Sanjeev Agrawal). The role of Managing Director cannot be equated with that of mere Director. Hence, the benefit of parity of that order would not be available to the petitioners who are the defaulting company and its managing director.
Under the circumstances, on the grounds taken, the prayer to quash the first information report cannot be accepted, more so because a bare perusal of it discloses commission of cognizable offence.
With the aforesaid observations, the petition is dismissed with liberty to the petitioners to apply for bail.
Order Date :- 30.4.2019 AKShukla/-