Ankur Gupta And Another vs State Of Haryana And Another

CRM-M-47189-2026 (O&M) -1-

IN THE HIGH COURT FOR THE STATES OF PUNJAB AND
HARYANA AT CHANDIGARH

158



CRM-M-47189-2026 (O&M)
Date of decision : 31.08.2026

Ankur Gupta and another ...Petitioners

Versus

State of Haryana and another ...Respondents


CORAM: HON'BLE MRS. JUSTICE MANISHA BATRA

Present:- Mr. R. K. Handa, Senior Advocate with
Ms. Gauri Handa, Advocate
for the petitioners.

Mr. Apoorv Garg, Addl. A.G., Haryana.

MANISHA BATRA, J. (Oral)

1. The present petition has been filed under Section 528 of the
Bharatiya Nagarik Suraksha Sanhita, 2023 (for short ‘BNSS’) praying for
quashing of FIR No.0142 dated 14.02.2019, registered under Sections 406,
420 and 120-B of IPC at Police Station City Karnal, District Karnal, along
with all consequential proceedings arising therefrom. The petitioners have
also prayed for quashing of Final Report/Charge-sheet No.01 dated
17.09.2019 submitted under Section 173 Cr.P.C., order dated 17.07.2026
declining their application for discharge and order dated 23.07.2026 framing
charge against them in this case.
2. Brief facts of the case relevant for the purpose of disposal of
this petition are that the aforementioned FIR was registered on the basis of a
written complaint submitted by respondent No.2/complainant Sahil,
proprietor of M/s Tirupati Enterprises, Karnal, alleging therein that his
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business was being conducted through a broker, namely Om Parkash Mann.
The said broker struck a deal for rice for M/s Mam Raj Chunni Lal Exim,
Naya Bazar, Delhi, and informed the complainant that the said firm had
another concern namely M/s Royal Star Agro Foods. It was further alleged
that the complainant contacted the petitioner Ankur Gupta and was informed
by both the petitioners that M/s Royal Star Agro Foods and M/s Mam Raj
Chunni Lal Exim were their own firms and that the rice supplied by the
complainant would be unloaded at their godowns situated at Alipur and
payment would be made in accordance with the agreed terms. The
complainant further alleged that, on the strength of the aforesaid assurances,
rice started being sent to the godowns at Alipur and payments were initially
made, thereby gaining the complainant's confidence. According to the
complainant, in order to conceal the alleged conspiracy, rice was from time
to time purchased in the names of both firms but unloaded at the same
godowns, with delivery receipts being issued by the old employees of the
godowns. It was further alleged that in February, payment became delayed.
On enquiry, broker Om Parkash Mann informed that the payment would be
made within 2-4 days. Thereafter, the broker informed him that the
petitioners were refusing to make payment on the ground that the real owner
of M/s Royal Star Agro Foods was Rajesh Singla and that the payments had
been made to him or alternatively that the petitioners had nothing to do with
the said firm. The broker also informed the complainant that rice from
several rice mills had been sold to the petitioners and that they had cheated
other mills as well.
3. As per the further allegations, the complainant thereafter, along
with the broker, went to the residence of Rajesh Singla, who stated that he
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had been carrying on business with the petitioners for about two years, had
suffered losses and had incurred debts towards them. He stated that, taking
advantage of his financial condition, the petitioners had asked him to open a
firm in Delhi in his own name, namely M/s Royal Star Agro Foods, and
represented that they would conduct the purchase and sale of rice through
the said firm and would give him profit every month. He also disclosed that
the entire rice purchased through M/s Royal Star Agro Foods was shown on
the same day with the same truck number and weight, as having been sold
through bills issued by M/s Royal Star Agro Foods to M/s Mam Raj Chunni
Lal Exim, and that 8-10% less payment was sent by M/s Mam Raj Chunni
Lal Exim into the account of M/s Royal Star Agro Foods. It was further
alleged that the bills were issued in the name of M/s Royal Star Agro Foods
so as to make it appear that there was no liability in the account of M/s Mam
Raj Chunni Lal Exim. It was further alleged that, in order to maintain the
confidence of the mill owners, the petitioners occasionally purchased rice in
the name of M/s Mam Raj Chunni Lal Exim also and that delivery receipts
of the rice taken by M/s Royal Star Agro Foods were issued by persons
associated with the godowns. Rajesh Singla further disclosed that on bills by
which rice was shown as sold to M/s Royal Star Agro Foods, there were no
truck numbers, gate passes or weighment slips and, according to him, no rice
was actually taken out of the godown in such transactions.
4. As per the further allegations, when the complainant went to the
shop of the petitioners at Naya Bazar, Delhi and confronted them with the
disclosure made by Rajesh Singla, the petitioners showed him their account
statement of dealings with M/s Royal Star Agro Foods and stated that
payments had been made to the said firm and, on the contrary, M/s Mam Raj
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Chunni Lal Exim had to recover about Rs.49 lakh from Rajesh Singla. The
complainant alleged that, on examining the statement, he found that about
Rs.1.25 crore had not been sent to M/s Royal Star Agro Foods and that bills
of about Rs.1.70 crore had been made in the name of Royal Star so as to
show liability towards that firm. He further alleged that Ankur Gupta, on
being confronted, snatched the statement from him and told him that there
was no need to make any further enquiry and that payment should be
demanded from the broker or Rajesh Singla. While alleging that several
aggrieved rice millers had approached the authorities for registration of an
FIR and that the petitioners had hatched a conspiracy and committed
cheating with him and caused wrongful loss of Rs.15,34,359.50, the
complainant prayed for taking action in the matter. After registration of the
FIR, investigation proceedings were initiated. The petitioners were granted
concession of anticipatory bail by the Court of learned Additional Sessions
Judge, Karnal. After completion of investigation, challan was presented on
17.09.2019 before the learned trial Court and the presently, the petitioners
are facing trial for commission of aforementioned offences.
5. The petitioners subsequently moved an application under
Section 239 Cr.P.C. seeking their discharge. Vide order dated 17.07.2026,
the learned Judicial Magistrate First Class, Karnal, dismissed the discharge
application, holding that the contentions regarding the earlier inquiry by the
Economic Offences Wing and other aspects required appreciation of oral and
documentary evidence at trial. Thereafter, on 23.07.2026, the learned trial
Court proceeded to frame charges against the petitioners.
6. It is argued by learned counsel for the petitioners that they have
been falsely implicated in this case. The entire dispute arises out of
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CRM-M-47189-2026 (O&M) -5-

commercial transactions concerning sale and supply of rice and at its
highest, relates to an alleged outstanding amount of Rs.15,34,359.50. It is
contended that the petitioners had no direct transaction of purchase or sale
with the complainant or M/s Tirupati Enterprises and that their commercial
dealings during the relevant period were with Rajesh Kumar Singla,
proprietor of M/s Royal Star Agro Foods, through regular banking channels.
Learned counsel further submits that the very allegations forming the basis
of the FIR had already been examined by the Economic Offences Wing,
District Police, Karnal, pursuant to complaints submitted in the year 2018 by
Ratan Lal, father of respondent No.2. The Economic Offences Wing, after
examining the bills and records, recorded that the petitioners' firm had not
taken or purchased any goods or rice from M/s Tirupati Enterprises, that no
transaction of money was found between the parties, that as per the
complainant's own bills the goods had been sold to Rajesh Kumar, proprietor
of M/s Royal Star Agro Foods and that the dispute regarding payment was
civil in nature with no cognizable offence made out. Despite the aforesaid
reports and without any fresh material or circumstance having come on
record, the impugned FIR was registered on the same allegations. Learned
counsel further submits that the FIR itself does not disclose any entrustment
of property or dominion over property so as to attract Section 406 of IPC. It
is also contended that there is no specific averment showing any dishonest or
fraudulent intention on the part of the petitioners at the inception of the
transaction, which, according to learned counsel, is an essential ingredient of
the offence of cheating.
7. It is further submitted by learned counsel for the petitioners that
the learned trial Court, while declining their discharge, has deferred
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CRM-M-47189-2026 (O&M) -6-

consideration of the aforesaid material to the stage of trial despite the same
being documentary material forming part of the record. It is argued that the
charge has thereafter been framed mechanically and that the allegations
under Sections 420, 406 and 120-B IPC have been framed on substantially
the same set of facts. While submitting that continuation of the proceedings
against the petitioners under the impugned FIR would be nothing but abuse
of the process of law, it is urged that the petition deserves to be allowed and
the FIR in question along with all the subsequent proceedings are liable to be
quashed. To fortify his arguments, learned counsel for the petitioners has
relied upon Delhi Race Club (1940) Ltd. and others vs. State of Uttar
Pradesh and another, 2024 INSC 626 .
8. Notice of motion to respondent No. 1 only.
9. Learned State counsel, who has advance notice of the petition,
has argued that sufficient material was collected during investigation which
discloses a prima facie case against the petitioners for the offences in
question. The allegations in the FIR are not confined merely to non-payment
of an outstanding commercial amount. In fact, the petitioners represented
M/s Mam Raj Chunni Lal Exim and M/s Royal Star Agro Foods as
interconnected concerns, induced the complainant to supply rice on the
assurance of payment, initially made payments so as to gain confidence and
thereafter withheld the remaining amount while using M/s Royal Star Agro
Foods for the alleged fraudulent transactions. The objections raised by the
petitioners regarding inconsistencies in the statements of prosecution
witnesses, the earlier inquiry conducted by the Economic Offences Wing,
absence of direct dealings with the complainant and alleged defects in the
investigation are matters requiring appreciation of evidence and cannot
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appropriately be adjudicated at the present stage. It is further submitted that
merely because the transactions have a commercial character or may also
give rise to civil liability, criminal liability is not automatically excluded
where the allegations, taken at their face value, disclose the ingredients of
the offences alleged. Hence, it is urged that the petition is liable to be
dismissed.
10. This Court has heard the rival submissions of learned counsel
for the parties.
11. At the outset, it will be profitable to look into the scope and
ambit of the Court’s power under Section 528 of BNSS (which is pari
materia with Section 482 of Cr.P.C.) as spelt out in several judicial
pronouncements of Hon’ble Supreme Court as well as different High Courts.
The well settled proposition of law is that in exercise of inherent powers
under Section 482 Cr.P.C., the High Court is not expected to analyze all the
facts, which are to be placed before the High Court. The power conferred
under this section is very specific. To secure the ends of justice, to prevent
the abuse of process of Court or to make any such orders as may be
necessary to give effect to any order under the Code, such power can be
exercised to prevent abuse of process of Court. The Hon’ble Supreme Court
has drawn up some guidelines in some categories of cases by way of
illustration to circumscribe the exercise of inherent power under Section 482
of Cr.P.C. to prevent abuse of process of any Court or to securethe ends of
the justice or to give effect to an order of the Court. A celebrated
pronouncement on this point is the case cited as State of Haryana Vs.
Bhajan Lal : 1992 SUPP (1) SCC 335 , wherein Hon’ble Supreme Court has
discussed different categories of cases wherein the power under Section 482
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Cr.P.C. could be exercised either to prevent abuse of process of law or
otherwise to secure the ends of justice, while observing that it might not be
possible to lay down any precise, clearly defined, sufficiently channelized,
inflexible guidelines or rigid formulae and to give an exhaustive list or
myriad kind of cases where such powers should be exercised. The following
principles have been culled out:-
“102 (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;
(3) Where the uncontroverted allegations made in the FIR or
complaint and the evidence collected in support of the same
do 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
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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,
providing efficacious redress for the grievance of the
aggrieved party;
(7) Where a criminal proceeding is manifestly attended with
mala 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.”
12. The principles of law as laid down by Hon’ble Supreme Court
in Bhajan Lal’ s case (supra) have been followed in a catena of judgments.
In Paramjeet Batra vs. State of Uttarakhand, (2013) 11 SCC 673 , it was
observed by Hon’ble Supreme Court that although the inherent powers of a
High Court under Section 482 of the Code should be exercised sparingly and
only for the purpose of preventing abuse of process of any Court or
otherwise to secure ends of justice, yet, the High Court must not hesitate in
quashing such criminal proceedings, where essential ingredients of the
offence are not made out. In Randheer Singh vs. State of Uttar Pradesh,
(2021) 14 SCC 626 , it was observed by Hon’ble Supreme Court that
criminal proceedings cannot be taken recourse to as a weapon of harassment.
13. Reference can further be made to Gian Singh vs. State of
Punjab, (2012) 10 SCC 303 , wherein Hon’ble Supreme Court observed that
the power of the High Court in quashing a criminal complaint or an FIR, in
exercise of its inherent jurisdiction, is distinct and different from the power
given to a criminal court for compounding the offences under Section 320 of
the Code. Inherent power is of wide plentitude with no statutory limitation
but it has to be exercised in accordance with the guidelines engrafted in such
power viz; (i) to secure the ends of justice or (ii) to prevent abuse of the
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process of any Court. Reference can further be made to Narinder Singh and
Ors. Vs. State of Punjab : (2014) 6 SCC 466, wherein it was by Hon’ble
Supreme Court that while exercising power under Section 482 of Cr.P.C.,
the High Court has to examine as to whether the possibility of conviction is
remote and bleak and continuation of criminal case would put him into great
oppression and prejudice and injustice would be caused to him by not
quashing criminal case.
14. In Dhruvaram Murlidhar Sonar vs. State of Maharashtra :
2019 (18) SCC 191, Hon’ble Supreme Court, while reiterating the
parameters as laid down in Bhajan Lal ’s case (supra), had observed that for
quashing of the proceedings, meticulous analysis of factum of taking
cognizance of an offence by the Magistrate was not called for. Appreciation
of evidence was also not permissible in exercise of inherent powers. If the
allegations set out in the complaint did not constitute the offence of which
cognizance has been taken, it is open to the High Court to quash the same in
exercise of its inherent powers.
15. In Neeharika Infrastructure vs. State of Maharashtra : 2021
SCC OnLine SC 315 , the Apex Court observed that the Courts ought to be
cautious in exercising powers under Section 482 of Cr.P.C. They do have
power to quash. The test is whether or not the allegations in the FIR disclose
the commission of a cognizable offence? The merits of the allegations are
not to be entered into nor the power of the investigating agency to
investigate into allegations involving the commission of a cognizable
offence is to be trenched upon.
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16. Similar position of law was reiterated by Hon’ble Supreme
Court in Ajay Malik vs. State of Uttarakhand, 2025 SCC OnLine SC 185,
wherein it was observed as follows:
“8. It is well established that a High Court, in exercising
its extraordinary powers under Section 482 of the CrPC,
may issue orders to prevent the abuse of court processes
or to secure the ends of justice. These inherent powers are
neither controlled nor limited by any other statutory
provision. However, given the broad and profound nature
of this authority, the High Court must exercise it
sparingly. The conditions for invoking such powers are
embedded within Section 482 of the CrPC itself, allowing
the High Court to act only in cases of clear abuse of
process or where intervention is essential to uphold the
ends of justice.
9. It is in this backdrop that this Court, over the course of
several decades, has laid down the principles and
guidelines that High Courts must follow before quashing
criminal proceedings at the threshold, thereby pre-
empting the Prosecution from building its case before the
Trial Court. The grounds for quashing, inter alia,
contemplate the following situations : (i) the criminal
complaint has been filed with mala fides; (ii) the FIR
represents an abuse of the legal process; (iii) no prima
facie offence is made out; (iv) the dispute is civil in
nature; (v.) the complaint contains vague and omnibus
allegations; and (vi) the parties are willing to settle and
compound the dispute amicably ( State of Haryana v.
Bhajan Lal, 1992 Supp (1) SCC 335 ).”
17. On applying the above discussed principles of law to the present
case, it is revealed that the allegations contained in the FIR, taken at their
face value, cannot be said to constitute a simple case of non-payment of
money arising out of a commercial transaction. The complainant has
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specifically alleged that the petitioners represented M/s Royal Star Agro
Foods and M/s Mam Raj Chunni Lal Exim to be their own firms and assured
him that the rice supplied by him would be received at their godowns and
payment would be made in accordance with the agreed terms. It has further
been alleged that initially payments were made, thereby gaining the
confidence of the complainant, and thereafter rice was purchased in the
names of the two firms but was unloaded at the same godowns. The
allegations do not stop at the non-payment of the outstanding amount. The
complainant has further relied upon the disclosure allegedly made by Rajesh
Singla regarding the manner in which M/s Royal Star Agro Foods was being
operated and the alleged arrangement between the two firms. There are also
allegations that the transactions were shown in the name of M/s Royal Star
Agro Foods in order to shift or conceal the liability of M/s Mam Raj Chunni
Lal Exim. The complainant has alleged that, despite having received the
goods, the petitioners subsequently denied their connection with one of the
firms and sought to shift the liability upon the broker or Rajesh Singla. Thus,
whether these allegations are ultimately proved or not is a matter to be
examined during trial but at this stage they cannot be held to be so inherently
improbable or devoid of substance that the entire criminal proceedings
deserve to be quashed.
18. It is also significant that the investigation has already been
completed, challan has been presented and the learned trial Court, after
considering the material available on record, has declined the prayer for
discharge of the petitioners and has thereafter framed charges against them.
The contentions raised by learned counsel for the petitioners regarding the
earlier inquiry conducted by the Economic Offences Wing, the nature of the
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transactions, the accounts maintained between the parties and the absence of
any direct transaction with the complainant are matters which would require
appreciation of the evidence on record. Such disputed questions cannot
appropriately be examined in the exercise of inherent jurisdiction under
Section 528 of the BNSS. At this stage, this Court is only required to see
whether the allegations and material collected during investigation disclose a
prima facie case and not whether the petitioners would ultimately be
convicted. The mere fact that the underlying transactions are commercial in
nature or that the complainant may also have a civil remedy would not, by
itself, justify quashing of the criminal proceedings when the allegations, on
their face, disclose the elements of deception, dishonest inducement and an
alleged concerted arrangement between the parties. The defence of the
petitioners and the explanation sought to be offered by them can be
appropriately considered by the learned trial Court on the basis of evidence.
Consequently, no exceptional circumstance is made out warranting
interference by this Court in exercise of its inherent jurisdiction.
19. As regards the judgment in Delhi Race Club’s case (supra) , the
same is distinguishable on facts. In the said case, the Supreme Court was
dealing with a case where the complaint essentially alleged that the price of
goods supplied had not been paid and found absence of the necessary
ingredients of cheating and criminal breach of trust. In the present case,
however, the allegations are not confined to mere non-payment of the price;
rather, there are specific allegations of false representation, dishonest
inducement, initial payments to gain confidence and an alleged arrangement
between the two firms for routing the transactions and avoiding liability. The
ratio of the said judgment, therefore, cannot be mechanically applied to the
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facts of the present case.
20. In view of the foregoing discussion, this Court finds no ground
to interfere with the FIR, the final report/charge-sheet, the order declining
discharge or the order framing charges against the petitioners. The petition,
accordingly, deserves to be dismissed.
21. However, it is made clear that the observations made herein
above are only for the purpose of deciding the present petition and the same
shall not be construed as expression of opinion on the merits of the case.

31.08.2026 (MANISHA BATRA)
Waseem Ansari Waseem Ansari Waseem Ansari Waseem Ansari
JUDGE



Whether speaking/reasoned Yes/No

Whether reportable Yes/No
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