Dharmi Athreya Swaminathan And Ors vs State Of Maharashtra And Anr
- Court
- Bombay High Court
CNR No : HCBM010191902018
2026:BHC-AS:42330
Supriya WP-1877-2018.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
WRIT PETITION NO. 1877 OF 2018
1. Mrs. Dharmi Athreya Swaminathan
Age: 69 years, Occupation: Business
Residing at: C 201, Eden III,
Hiranandani Gardens, Powai,
Mumbai 400 079
SUPRIYA
PRAMOD
JAWARE
2. Mrs. Kavita Vaidyanathan
Age: 41 years,
Residing at: 302, Vigyan,
rd
3 Floor, Sector – 17, Vashi,
New Mumbai
Digitally signed by
SUPRIYA
PRAMOD JAWARE
Date: 2026.10.16
19:47:32 +0530
3. Rashmin Panachan Shah
Age: 56 years, Occupation: Business
Having Office at: 9, Trimurti,
Ashok Nagar, Cross Road No.2,
Kandivali (E), Mumbai.
4. Mrs. Bhagyalata Ravindra Panchal
Age: 47 years, Occupation: Business
Residing at: 1, Yoga Yog Saddan,
Ramwadi, Jogeshwari Vikhroli Link Road,
Jogeshwari (E), Mumbai – 400 060
… Petitioners
V/s.
1. The State of Maharashtra,
At the instance of
Jogeshwari Police Station, Mumbai.
2. Lachman Staramdas Pardasani,
Age: 70 Years, Occupation: Business
Indian Inhabitant
Residing at: 302, Nisarg Society,
Nargis Dutt Marg, Mumbai 50. … Respondents
______________________
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Mr. Siddhesh Bhole a/w Ms. Shreya Agarwal i/by Mr. Abdullah Katlariwala for
the Petitioners.
Mrs. Sangita Phad, A.P.P. for Respondent -State.
Ms. Mallika Ingale for the Respondent No.2.
______________________
CORAM : RANJITSINHA RAJA BHONSALE, J.
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RESERVED ON : 17 JULY 2026
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PRONOUNCED ON : 15 OCTOBER 2026
JUDGMENT: -
1) By the present Petition, filed under Article 227 of the Constitution
of India and Section 482 of Code of Criminal Procedure, 1973 (for short
‘CrPC’)/now 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, the
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Petitioners seek to quash and set aside the Order dated 13 March 2018
passed by Additional Sessions Judge, Dindoshi, Mumbai whereby the
Petitioner’s Revision Applications were dismissed. The Petitioners also seek
discharge of the Petitioners from Criminal Case No. 783/PW/2012 pending
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before the Additional Chief Metropolitan Magistrate, 10 Court, Andheri.
2) Heard, Mr. Siddhesh Bhole for the Petitioners, Mrs. Sangita Phad,
A.P.P for Respondent and Ms. Mallika Ingale for Respondent No.2.
3) Briefly stated the Prosecution case as alleged is as under:
3.1) The Complainant/Respondent No.2 and Accused No.1 i.e. V.
Swaminathan were partners in M/s. Fabdecon Engineers. They decided to
start a new company by the name of M/s. Akay Organic Limited. That,
Respondent No.2 was busy in managing the business of Akay Organics Pvt
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Ltd. Mr. V. Swaminathan/Accused No.1 was looking after the business and
affairs of M/s. Fabdecon Engineers. The Accused No.1 took undue advantage
of his having control and dominion over the assets including knowhow,
designs data etc. of M/s. Fabdecon Engineers and fraudulently
misappropriated the same for his personal use, benefit and profit. The
Accused Nos. 2 to 7 abetted the Accused No.1 in the said plan/conspiracy by
starting various front companies. The front companies were used to divert the
orders/profits, etc.
3.2) That, Accused No.6 i.e. Ms. Bhagyalata Ravindra Panchal was the
proprietor of M/s. Deman Engineers. Accused No.2 Ms. Dharmi Swaminathan
was proprietor of M/s. Traxit Engineers. The Accused No. 1 diverted Orders
received by M/s. Fabdecon Engineers to the front companies and transferred
profits to their personal accounts opened in the name of proprietary firm.
That, Accused No.1 subsequently resigned as partner from M/s. Fabdecon
Engineers and became the CEO of M/s. Traxit Engineers Private Limited.
3.3) That, the Prosecution case is of diversion of recurring Orders of
M/s. Fabdecon Engineers to M/s. Deman Engineers and M/s. Traxit Engineers.
That, documents also show diversion of funds, which were earned as profits,
by executing the diverted Orders in the aforesaid manner from the above
mentioned front companies. The funds were diverted to Accused No.1 who in
turn transferred the funds to the accounts of M/s. Deman Engineers. That,
funds were diverted to the account of M/s. Dharmik Associates started in the
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name of Accused No.3. Funds were diverted to Chroma Industries without
corresponding invoices etc. There are various documents and record which
show complicity of the co-accused in abetting Accused No.1 in committing the
offence of fraudulent misappropriation of the assets.
4) Mr. Siddhesh Bhole, learned Advocate appearing for the
Petitioners submits that: -
4.1) The Respondent No.2 and Accused No.1 were partners in M/s.
Fabdecon Engineers since 1979. Original Accused No.4 Ravindra Panchal was
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the senior draftsmen with the said firm and he resigned on 12 July 1997. On
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8 July 1999, the Petitioner No.2 Savita Swaminathan the daughter of
Accused No.1 along with Accused No.4 Ravindra Panchal incorporated with
M/s. Traxit Engineers Pvt. Ltd. Based on the allegation that, the orders meant
for M/s. Fabdecon Engineers were diverted by the Accused, complaint
application came to be filed under Section 156(3) of the Code of Criminal
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Procedure before the ACMM, 16 Ballard Pier Court. Investigation was
directed through the Yellow Gate Police Station.
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4.2) By Order dated 16 December 2002, the ACMM, 16 Ballard Pier
Court, returned the complaint under Section 201 of the CrPC after accepting
the report from the Yellow Gate Police Station. This was on the ground that,
the alleged offences had not been committed within its jurisdiction.
Thereafter, Respondent No.2 preferred the above complaint and by order
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dated 20 August 2002, the ACMM, Andheri Court directed the MIDC, Police
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Station to investigate the complaint in which a ‘C’ Summary Report was filed
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on 14 June 2004. The Respondent No.2 preferred a Protest Petition against
the ‘C’ Summary Report.
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4.3) On 5 February 2005, the ACMM Andheri Court after considering
the Protest Petition filed by Respondent No.2 directed the Jogeshwari Police
Station i.e. the Police Station distinct from MIDC Police Station who had
conducted the earlier investigation to “conduct a reinvestigation” into the
same complaint. Pursuant to the said reinvestigation, the Jogeshwari Police
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Station filed a chargesheet on 12 April 2012 under Sections 403, 406, 409,
420, 468 read with Section 34 of the IPC against the Petitioners and the other
Accused.
4.4) After filing of the chargesheet, the Petitioner filed an Application
for discharge under Section 239 of the CrPC which was rejected by Order
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dated 28 July 2016 against which the Petitioners preferred the Criminal
Revision Applications.
4.5) The Magistrate had no jurisdiction or authority to direct a
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reinvestigation or fresh investigation. The Order dated 5 February 2005,
directing reinvestigation of the complaint is untenable. It is a settled law that,
the Magistrate has no power to direct reinvestigation or fresh investigation.
The Sessions Judge erred in holding that the use of the word ‘reinvestigation’
in the order ought to be read down and construed as an order for further
investigation under Section 173(8) of the CrPC. That, in effect the Magistrate
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in fact transferred the investigation to a unconnected/different Police Station
and directed a reinvestigation.
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4.6) The Order dated 5 February 2005 directing reinvestigation is
without jurisdiction. Therefore, the entire subsequent proceedings including
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filing of the charge-sheet which is founded upon the order dated 5 February
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2005 is vitiated. The Order dated 5 February 2005 clearly orders the
reinvestigation which is not permissible.
4.7) Reliance was placed on the Judgment of the Vinay Tyagi Vs.
Irshad Ali alias Deepak and Ors. , reported in (2013) 5 SCC 762, Hemant
Dayalal Bhatt Vs. State of Maharashtra and Anr. Passed in Criminal
Application No. 460 of 2013, Infrastructure Leasing & Financial Services Ltd.
Vs. The State of Maharashtra & Anr. , reported in 2016 SCC OnLine Bom
10579 and Vinubhai Haribhai Malaviya & Ors. Vs. State of Gujrat & Anr.
Reported in (2019) 17 SCC 1.
4.8) No role has been assigned to Petitioner No.3. The Petitioner No.3
has already been discharged from offence under Section 403, 406, 409, 468
read with 34 of the IPC. The only relation/connection of the Petitioner No.3
with the transaction is that he allegedly functions as a trade/marketing
representative of Accused No.7 and is a director of M/s. Traxit Pvt. Ltd. That,
there is no specific overt act or dishonest inducement which is attributable to
the Petitioner No.3.
4.9) No role has been attributed to the Petitioner Nos. 1 and 2, who
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are the wife and daughter of the original Accused No.1. Petitioner No.1 is a
housewife and never an employee, partner or officer of M/s. Fabdecon
Engineers. The only connection of Petitioner No.1 as alleged in the
chargesheet is that she is the wife of Accused No.1 and a majority shareholder
in M/s. Traxit Industries Pvt. Ltd. That, no act of negotiation, inducement or
execution of any diverted order is attributed to Petitioner No.1. Petitioner
No.1 has been discharged from Sections 403, 406, 409, 468 read with 34 of
the IPC.
4.10) Petitioner No.2 is discharged under Section 403, 406 and 409
read with 34 of the IPC. That, charging Petitioner No.2 with an offence under
Section 468 of the IPC relying on certain letter which is said to bear her
signature is totally unfounded and untenable. The Order notes that, the
language and contents of those letters are of Accused No.1. That, a Director
signing correspondence drafted by or at the instance of another does not by
itself establish mens rea of forgery under Section 463 of the IPC i.e. making a
false document with intent to cause damage or injury or support a false claim
or commit or facilitate commission of a fraud. None of the ingredients of
forgery under Section 463 of IPC are made out.
5) Ms. Mallika Ingale, the learned Advocate for the Respondent
submitted that:
5.1) There is enough material on record which prima facie indicates
that, orders of M/s. Fabdecon Engineers have been diverted by Accused
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including the Petitioners. The profits have been diverted to personal accounts
or accounts of proprietary concerns and have been misappropriated.
5.2) Accused No.1 had dominance over all the assets including
technical knowhow, designs of products, bank accounts and clients list of M/s.
Fabdecon Engineers. The information was available with the Accused No.1 in
trust. The same has been fraudulently and dishonestly misappropriated and
used for personal benefit and profit with the help, assistance and abetment of
Accused Nos. 2 to 7.
5.3) The documents gathered by the Investigating Officers clearly
make out a case against the Accused and show their involvement in abetting
Accused No.1 in the offences as alleged. There is a clear flow of diversion of
orders and funds. The statements of various employees have been recorded
which would corroborate, support and make out the offences as alleged
against the Accused.
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5.4) The Petitioners did not choose to challenge the Order dated 5
February 2005. The Petitioners accepted the chargesheet and choose to file a
discharge application. The scope and ambit of consideration and appreciation
of the facts is very restricted and limited. While considering an application
under Section 239 of the CrPC, the Court primarily only considers the police
report under Section 173 and documents therewith.
6) Mrs. Sangita Phad, learned APP for the State, adopted the
arguments advanced by Ms. Mallika Ingale, learned advocate for the
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Respondent No.2.
7) Perused the entire record. The allegation of Respondent No.2 is
that, Respondent No.2 and Accused No.1 were partners in M/s. Fabdecon
Engineers and also started a new company known by the name of M/s. Akay
Organics Pvt. Ltd. It is the case of Respondent No.2 that, he was busy in
managing the business of Akay Organics Pvt. Ltd and Accused No.1 was
looking after the business, day to day administration and affairs of M/s.
Fabdecon Engineers. The case of the prosecution is that, Accused No.1 took
undue advantage of the said fact and allegedly diverted orders and
fraudulently diverted/misappropriated profits, the knowhow, design data and
misused his control and dominion over M/s. Fabdecon Engineers for his
personal use and benefit. It is alleged that, Accused No.1 in furtherance of the
plan was abetted by Accused Nos. 2 to 7 by starting various front companies
i.e. M/s. Deman Engineers, M/s. Traxit Engineers, M/s. Sona Industries, and
M/s. Dharmic Associates which were used to implement the plan i.e. divert
orders and resultant profits. It is the case of the prosecution that, the Accused
diverted orders received by M/s. Fabdecon Engineers to the front company
and executed the same through the front companies with the aid and
assistance of Accused Nos. 2 to 7. The profits generated from such diversion of
orders was transferred to personal accounts opened in name of proprietary
firms and eventually to the Accused No.1. Subsequently, Accused No.1
resigned as partner from M/s. Fabdecon Engineers and became CEO of M/s.
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Traxit Engineers.
8) Perusal of the chargesheet would indicate that, the Investigating
Officer has gathered various documents and material in respect of the
diversion of the recurring orders of M/s. Fabdecon Engineers and documents
indicating diversion of profit, etc. The documents placed on record include a
list showing the clientele of M/s. Fabdecon Engineers and showing diversion
of recurring orders of M/s. Fabdecon Engineers received from the said clients
to M/s. Deman Engineers (of which Accused No.6 is the proprietor) and M/s.
Traxit Engineers (company started in the name of Accused Nos. 2, 3, 5 and 7).
There are documents on record showing diversion of funds. The Accused No.
1 to 3 are related. Accused Nos. 2 is the wife of Accused No.1. The Accused
No.3 is the daughter of Accused No.1. Accused No.4 was the senior draftsmen
of M/s. Fabdecon Engineers, who resigned in the year 1997 and also assisted
Accused No.1 by actively participating in execution of the orders diverted to
the front companies M/s. Deman Engineers and M/s. Traxit Engineers.
Accused No.6 is the wife of Accused No.4. The prosecution also relies on
certain correspondence between the Accused and document signed by the
Accused which allegedly support the allegations of the Prosecution. There is a
flow chart on record indicating diversion of orders and funds. There are also
on record statements of Manish Gaur (employee of Indo Hydrolics), statement
of Tanaji Pagade (employee of J K Industrial) and statement of K. Joseph
(employee of M/s. Fabdecon Engineers which the prosecution relies on to
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support their case.
9) The flow chart, on record depicts the diversion of Orders from
clients of M/s. Fabdecon Engineers and also the diversion of the funds which
were generated from diverted Orders. M/s. Fabdecon Engineers was a
partnership firm of Accused No. 1 and Respondent No. 2/Complainant and
was established in the year 1979. M/s. Fabdecon Engineers appears to have a
substantial clientele base. Amongst the clients of M/s. Fabdecon Engineers,
there were some clients who allegedly had a personal rapport with the
Accused. Some of such clients are alleged to be M/s. Plastichemix Inds. Ltd.,
M/s. Voltas Ltd., M/s. Sudershan Chemical Inds. Ltd., M/s. Indian Friction
Matl. Engg. Co., M/s. Cardinal Cosmetic Pvt. Ltd., M/s. Pidilite Industries Ltd.,
and M/s. August Neuhoff Tranxit Wire Lubrications Germany Promising
Client. It appears that the said companies were clients of M/s. Fabdecon
Engineers for a period ranging between 1983 and 2000. The recurring Orders
of the said companies from April 1997 appear to have been diverted to M/s.
Deman Engineers, a front firm/company established in 1997, the proprietor of
which was original Accused No. 6/ Petitioner No. 4 herein. It further appears
that, the company by the name of August Neuhoff Tranxit Wire Lubrications
Germany promised huge recurring Orders between the years 1986 and 1999,
but the Orders were diverted to M/s. Traxit Engineers between the period
1999 and 2005. M/s. Traxit Engineers is also one of the front companies
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incorporated on 8 July 1999. M/s. Traxit Engineers has made remittances to
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one Mr. Ravindra Panchal, who is the husband of Petitioner No. 4 and an
accomplice of the Accused No.1, who has further made deposits with M/s.
Deman Engineers.
10) Further, it appears that M/s. Deman Engineers diverted funds by
way of cash withdrawals, i.e., loans given to one Divya, who is related to/ a
niece of the Accused No.1, amounts diverted to M/s. Sona Industries, one of
the front companies/firms, amounts diverted to Steel Cons., a group company
of Quality Engineers Fabricator for M/s. Traxit Engineering, and payments
made to firms of the Accused's neighbours and other friends/companies
namely, M/s. Lata Steel, M/s. Kapasi Enterprises, and M/s. Emkay Engineers.
Funds generated from diverted Orders were also transferred by M/s. Traxit
Engineers to Steel Cons., a group company of Quality Eng. Fabricator for M/s.
Traxit Engineer, and payments were made to firms of the Accused's neighbours
and other friends/companies, namely M/s. Lata Steel, M/s. Kapasi
Enterprises, and M/s. Emkay Engineers. M/s. Traxit Engineers also diverted
funds for personal use to M/s. Dharmic Associates, a firm of Kavitha
Swaminathan, i.e., Accused No. 3 and daughter of Accused No. 1, from which
company there are alleged to have been cash withdrawals. There are also cash
withdrawals from M/s. Traxit Engineers.
11) Perusal of the statement of the Complainant reveals that, the
allegation is that the diversion of Orders of M/s. Fabdecon Engineers started
in or around April 1997. Accused No. 1 was in charge and in control of the
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affairs of M/s. Fabdecon Engineers, and he had developed a personal rapport
with clients from whom Orders were diverted. Respondent No.2 has alleged
that: -
(i) An Order from Plastichemix, one of the important clients of M/s.
Fabdecon Engineers, with whom Accused No. 1 had a personal rapport,
had been diverted to M/s. Deman Engineers, and advance payment
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was made as early as 22 April 1997. It is alleged that the first sale
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was effected by M/s. Deman Engineers on 30 June 1997, which was
before Accused No. 4, Ravindra Panchal, resigned from M/s. Fabdecon
Engineers.
(ii) Recurring Orders from one of the important clients, M/s. Voltas
Ltd., which had been placing Orders with M/s. Fabdecon Engineers
since the year 1983, had been diverted to M/s. Deman Engineers from
1997.
(iii) Orders of Sudershan Chemical Inds. Ltd. for a Sigma Mixer, which
were placed with M/s. Fabdecon Engineers in 1998, were manipulated
and shown to have been cancelled, and the said Orders were diverted
to M/s. Deman Engineers even before the cancellation of the Orders.
Though the Orders were diverted, Accused No. 1 continued to show
pretentious correspondence with the client till February 1999.
(iv) Orders from Indian Friction Material Engineering Co. (Order of
September 1998), Cardinal Cosmetic Pvt. Ltd. (Order of March 2000),
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and Pidilite Industries Ltd. (Order of July 2001) were allegedly all
diverted to the front firm/Company, M/s. Deman Engineers. It is
alleged that the modus operandi of the front firms, i.e., M/s. Deman
Engineers and M/s. Traxit Engineers Pvt. Ltd., seems to be similar.
(v) All operations of M/s. Deman Engineers are being carried out by
Accused No. 4, with Accused No. 1 being behind the scenes. M/s.
Deman Engineers has dealings with M/s. Steel Co. Pvt. Ltd., with which
M/s. Traxit Engineers, one of the front companies, has dealt in the
manufacture of equipment for a German client. The diverted funds
generated from the diverted Orders have been siphoned off to another
firm by the name of M/s. Sona Industries, whose ownership has to be
investigated.
(vi) Funds from M/s. Deman Engineers have also been diverted
through disproportionate cash withdrawals, payments to the owner of
M/s. Jyoti Steel, who happens to be the owner of Accused No. 1, and
payments to firms of friends like M/s. Kapasi Enterprises and M/s.
Emkay Engineers, with whom Accused No. 1 had financial relations
through M/s. Fabdecon Engineers.
12) There are on record documents that, would prima fcie indicate
that, the Accused No. 1 after he resigned from M/s. Fabdecon Engineers was
running the affairs of business of M/s. Taxit Engineer.
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13) Perusal of the flow chart depicting the diversion of Orders and
funds and the statements of the Complainant themselves prima facie indicates
that there is material on record which raises a strong suspicion. Prima facie
there is enough material on record which would be available for proceeding to
frame charge against the Accused. In the background of the material on
record, it cannot be said that the charge is groundless or that no case is made
out against the Accused. The material on record, the complex nature of the
allegations and considering the facts and material in totality, there prima facie
appears to be strong suspicion against the accused and material is available to
proceed to frame the charge. In my opinion it cannot be said that, the charges
are groundless.
14) It would be necessary to refer certain judgments on discharge
which are relevant for the issues in the present matter: -
14.1) The Supreme Court in the case of R.S. Nayak vs. A.R. Antulay and
Anr. reported in AIR 1986 SC 2045, while analysing provisions of Sections
227, 239 and 245 of Cr.P.C., in unequivocable terms in Para 44 has held as
under: -
"The Code contemplates discharge of the accused by the Court of
Sessions under Section 227 in a case triable by it; cases instituted
upon a police report are covered by Section 239 and cases
instituted otherwise than on police report are dealt with in Section
245. The three sections contain some what different provisions in
regard to discharge of the accused. Under Section 227, the trial
Judge is required to discharge the accused if he 'considers that
there is not sufficient ground for proceeding against the accused.’
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Obligation to discharge the accused under Section 239 arises when
"the Magistrate considers the charge against the accused to be
groundless." The power to discharge is exercisable under Section
245(1) when "the Magistrate considers, for reasons to be recorded,
that no case against the accused has been made out which, if
unrebutted, would warrant his conviction.” It is a fact that Sections
227 and 239 provide for discharge being ordered before the
recording of evidence and the consideration as to whether charge
has to be framed or not is required to be made on the basis of the
record of the case, including documents and oral hearing of the
accused and the prosecution or the police report, the documents
sent along with it and examination of the accused and after
affording an opportunity to the two parties to be heard. The stage
for discharge under Section 245, on the other hand, is reached only
after the evidence referred to in Section 244 has been taken.
Notwithstanding this difference in the position there is no scope for
doubt that the stage at which the Magistrate is required to consider
the question of framing of charge under Section 245(1) is a
preliminary one and the test of “prima facie” case has to be applied.
In spite of the difference in the language of the three sections, the
legal position is that if the trial Court is satisfied that a prima facie
case is made out, charge has to be framed."
14.2) An extremely useful reference can be made to the judgment of
the Hon’ble Supreme Court in the case of Ghulam Hassan Beigh v. Mohd.
Maqbool Magrey, reported in (2022) 12 SCC 657, where in paragraphs 23 and
26, the Hon’ble Supreme Court has observed as under: -
“23. In Sajjan Kumar v. CBI [Sajjan Kumar v. CBI, (2010) 9 SCC
368: (2010) 3 SCC (Cri) 1371], this Court had an occasion to
consider the scope of Sections 227 and 228CrPC. The principles
which emerged therefrom have been taken note of in para 21 as
under: (SCC pp. 376-77)
“21. On consideration of the authorities about the scope of
Sections 227 and 228 of the Code, the following principles
emerge:
(i) The Judge while considering the question of framing the
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charges under Section 227CrPC has the undoubted power to
sift and weigh the evidence for the limited purpose of finding
out whether or not a prima facie case against the accused has
been made out. The test to determine prima facie case would
depend upon the facts of each case.
(ii) Where the materials placed before the court disclose grave
suspicion against the accused which has not been properly
explained, the court will be fully justified in framing a charge
and proceeding with the trial.
(iii) The court cannot act merely as a post office or a
mouthpiece of the prosecution but has to consider the broad
probabilities of the case, the total effect of the evidence and the
documents produced before the court, any basic infirmities,
etc. However, at this stage, there cannot be a roving enquiry
into the pros and cons of the matter and weigh the evidence as
if he was conducting a trial.
(iv) If on the basis of the material on record, the court could
form an opinion that the accused might have committed
offence, it can frame the charge, though for conviction the
conclusion is required to be proved beyond reasonable doubt
that the accused has committed the offence.
(v) At the time of framing of the charges, the probative value of
the material on record cannot be gone into but before framing
a charge the court must apply its judicial mind on the material
placed on record and must be satisfied that the commission of
offence by the accused was possible.
(vi) At the stage of Sections 227 and 228, the court is required
to evaluate the material and documents on record with a view
to find out if the facts emerging therefrom taken at their face
value disclose the existence of all the ingredients constituting
the alleged offence. For this limited purpose, sift the evidence
as it cannot be expected even at that initial stage to accept all
that the prosecution states as gospel truth even if it is opposed
to common sense or the broad probabilities of the case.
(vii) If two views are possible and one of them gives rise to
suspicion only, as distinguished from grave suspicion, the trial
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Judge will be empowered to discharge the accused and at this
stage, he is not to see whether the trial will end in conviction
or acquittal.”
26. In State of Karnataka v. M.R. Hiremath [State of Karnataka v.
M.R. Hiremath, (2019) 7 SCC 515: (2019) 3 SCC (Cri) 109:
(2019) 2 SCC (L&S) 380], this Court held as under: (SCC p. 526,
para 25)
“25. The High Court ought to have been cognizant of the fact
that the trial court was dealing with an application for
discharge under the provisions of Section 239CrPC. The
parameters which govern the exercise of this jurisdiction have
found expression in several decisions of this Court. It is a
settled principle of law that at the stage of considering an
application for discharge the court must proceed on the
assumption that the material which has been brought on the
record by the prosecution is true and evaluate the material in
order to determine whether the facts emerging from the
material, taken on its face value, disclose the existence of the
ingredients necessary to constitute the offence. In State of T.N.
v. N. Suresh Rajan [State of T.N. v. N. Suresh Rajan, (2014) 11
SCC 709: (2014) 3 SCC (Cri) 529: (2014) 2 SCC (L&S) 721],
adverting to the earlier decisions on the subject, this Court
held: (SCC pp. 721-22, para 29)
‘29. … At this stage, probative value of the materials has to be
gone into and the court is not expected to go deep into the
matter and hold that the materials would not warrant a
conviction. In our opinion, what needs to be considered is
whether there is a ground for presuming that the offence has
been committed and not whether a ground for convicting the
accused has been made out. To put it differently, if the court
thinks that the accused might have committed the offence on
the basis of the materials on record on its probative value, it
can frame the charge; though for conviction, the court has to
come to the conclusion that the accused has committed the
offence. The law does not permit a mini trial at this stage.””
14.3) A useful reference can also be made to the judgment of the
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Hon’ble Supreme Court in the case of State of T.N. v. R. Soundirarasu,
reported in (2023) 6 SCC 768 where in paragraphs 60,61,67,69,72,73,78,79
the Hon’ble Supreme Court while dealing with the provision of Section 239 of
CrPC has observed that: -
“60. In the context of trial of a warrant case, instituted on a police
report, the provisions for discharge are to be governed as per the
terms of Section 239 which provide that a direction for discharge
can be made only for reasons to be recorded by the court where it
considers the charge against the accused to be groundless. It
would, therefore, follow that as per the provisions under Section
239 what needs to be considered is whether there is a ground for
presuming that the offence has been committed and not that a
ground for convicting the accused has been made out. At that
stage, even strong suspicion founded on material which leads the
court to form a presumptive opinion as to the existence of the
factual ingredients constituting the offences alleged would justify
the framing of charge against the accused in respect of that
offence, and it is only in a case where the Magistrate considers the
charge to be groundless, he is to discharge the accused after
recording his reasons for doing so.
61. Section 239 envisages a careful and objective consideration of
the question whether the charge against the accused is groundless
or whether there is ground for presuming that he has committed an
offence. What Section 239 prescribes is not, therefore, an empty or
routine formality. It is a valuable provision to the advantage of the
accused, and its breach is not permissible under the law. But if the
Judge, upon considering the record, including the examination, if
any, and the hearing, is of the opinion that there is “ground for
presuming” that the accused has committed the offence triable
under the chapter, he is required by Section 240 to frame in writing
a charge against the accused. The order for the framing of the
charge is also not an empty or routine formality. It is of a far-
reaching nature, and it amounts to a decision that the accused is
not entitled to discharge under Section 239, that there is, on the
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other hand, ground for presuming that he has committed an
offence triable under Chapter XIX and that he should be called
upon to plead guilty to it and be convicted and sentenced on that
plea, or face the trial. (See: V.C. Shukla v. State [V.C. Shukla v.
State, 1980 Supp SCC 92: 1980 SCC (Cri) 695]).
67. Thus, the word “groundless”, as interpreted by this Court,
means that there is no ground for presuming that the accused has
committed an offence.
69. The suspicion referred to by this Court must be founded upon
the materials placed before the Magistrate which leads him to form
a presumptive opinion as to the existence of the factual ingredients
constituting the offence alleged. Therefore, the words “a very
strong suspicion” used by this Court must not be a strong suspicion
of a vacillating mind of a Judge. That suspicion must be founded
upon the materials placed before the Magistrate which leads him to
form a presumptive opinion about the existence of the factual
ingredients constituting the offence alleged.
72. The real test for determining whether the charge should be
considered groundless under Section 239CrPC is that whether the
materials are such that even if unrebutted make out no case
whatsoever, the accused should be discharged under Section
239CrPC. The trial court will have to consider, whether the
materials relied upon by the prosecution against the applicant
herein for the purpose of framing of the charge, if unrebutted,
make out any case at all.
73. The provisions of discharge under Section 239CrPC fell for
consideration of this Court in K. Ramakrishna v. State of Bihar [K.
Ramakrishna v. State of Bihar, (2000) 8 SCC 547: 2001 SCC (Cri)
27], and it was held that the questions regarding the sufficiency or
reliability of the evidence to proceed further are not required to be
considered by the trial court under Section 239 and the High Court
under Section 482. It was observed as follows: (SCC p. 549, para
4)
“4. The trial court under Section 239 and the High Court
under Section 482 of the Code of Criminal Procedure is not
called upon to embark upon an inquiry as to whether
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evidence in question is reliable or not or evidence relied
upon is sufficient to proceed further or not. However, if upon
the admitted facts and the documents relied upon by the
complainant or the prosecution and without weighing or
sifting of evidence, no case is made out, the criminal
proceedings instituted against the accused are required to be
dropped or quashed. As observed by this Court in Rajesh
Bajaj v. State (NCT of Delhi) [Rajesh Bajaj v. State (NCT of
Delhi), (1999) 3 SCC 259: 1999 SCC (Cri) 401] the High
Court or the Magistrate are also not supposed to adopt a
strict hypertechnical approach to sieve the complaint through
a colander of finest gauzes for testing the ingredients of
offence with which the accused is charged. Such an
endeavour may be justified during trial but not during the
initial stage.”
78. In Munna Devi v. State of Rajasthan [Munna Devi v. State of
Rajasthan, (2001) 9 SCC 631: 2002 SCC (Cri) 775], this Court held
as under: (SCC p. 632, para 3)
“3. … The revision power under the Code of Criminal
Procedure cannot be exercised in a routine and casual
manner. While exercising such powers the High Court has no
authority to appreciate the evidence in the manner as the
trial and the appellate courts are required to do. Revisional
powers could be exercised only when it is shown that there is
a legal bar against the continuance of the criminal
proceedings or the framing of charge or the facts as stated in
the first information report even if they are taken at the face
value and accepted in their entirety do not constitute the
offence for which the accused has been charged.”
79. Thus, the revisional power cannot be exercised in a casual or
mechanical manner. It can only be exercised to correct manifest
error of law or procedure which would occasion injustice, if it is
not corrected. The revisional power cannot be equated with the
appellate power. A Revisional Court cannot undertake meticulous
examination of the material on record as it is undertaken by the
trial court or the appellate court. This power can only be exercised
if there is any legal bar to the continuance of the proceedings or if
the facts as stated in the charge-sheet are taken to be true on their
face value and accepted in their entirety do not constitute the
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offence for which the accused has been charged. It is conferred to
check grave error of law or procedure.”
14.4) It would also be useful to refer to the judgment of Hon’ble
Supreme Court in the case of State of Gujarat Vs. Dilipsingh Kishorsingh Rao
reported in (2023) 17 SCC 688 as while considering the scope and ambit in
respect of an application of discharge in paragraph 13 has observed that:
“13. The primary consideration at the stage of framing of
charge is the test of existence of a prima facie case, and at
this stage, the probative value of materials on record need
not be gone into. This Court by referring to its earlier
decisions in State of Maharashtra v. Som Nath Thapa [State
of Maharashtra v. Som Nath Thapa, (1996) 4 SCC 659:
1996 SCC (Cri) 820] and State of M.P. v. Mohanlal Soni
[State of M.P. v. Mohanlal Soni, (2000) 6 SCC 338: 2000
SCC (Cri) 1110] has held the nature of evaluation to be
made by the court at the stage of framing of the charge is
to test the existence of prima facie case. It is also held at
the stage of framing of charge, the court has to form a
presumptive opinion to the existence of factual ingredients
constituting the offence alleged and it is not expected to go
deep into probative value of the material on record and to
check whether the material on record would certainly lead
to conviction at the conclusion of trial.”
15) The Hon’ble Supreme Court has very categorically held that, at
the initial stage if there is strong and grave suspicion, based on which the
Court comes to conclusion, that a prima facie case is made out against the
accused, then it will not be open for the Court to say that there is no sufficient
ground for proceeding against the accused. In considering a discharge
application, the Court from the police report and the document sent with it
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under Section 173 of the CrPC, is required to see only whether a prima facie
case to proceed with the framing of charge/trial is made out and not whether
ultimately the trial would end in a conviction or an acquittal. While
considering an application for discharge, the Court is required to proceed on
the assumption that, the material available on record is true and consider the
said material at its face value, to ascertain whether a prima facie case is made
out and if the ingredients to make out the offence are available. The basic
criteria, is to see, whether a prima facie case is made out and no more.
16) At the time of considering the application for discharge the court
has to consider the facts as alleged at their face value and a presumptive
opinion has to be formed as to the existence of the facts and the ingredients as
required of the offences as alleged. The Court is not expected to conduct a
probative evaluation of the material nor a mini trial. The Court has to
basically consider whether there is material available to proceed in the matter
and frame the charge. At the stage of framing charge and/or considering a
discharge application, the Court is not required to undertake meticulous
evaluation of evidence. There is no appreciation of evidence as in and at the
time of a trial. It is settled law that, even grave suspicion is sufficient to frame
a charge.
17) Considering the material on record which forms part of the
chargesheet, it is clear that, there is enough material on record to proceed to
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frame the charge. A prima facie case of a strong suspicion is made out. No
case for discharge has been made out.
18) In the present case, one of the contentions of the Petitioners was
that, the entire proceeding is vitiated and cannot be sustained because by
th
Order dated 5 February 2005, the learned Magistrate had directed
reinvestigation of the complaint by the Jogeshwari Police Station after the
MIDC Police Station had already filed a ‘C’ Summary Report. It was contended
that, the Magistrate has no powers to direct reinvestigation or fresh
investigation. Under Section 173(8) of the CrPC, the power of the Magistrate
is confined only to direct further investigation which contemplates
continuation of the same investigation. No doubt it is true that, only the
Hon’ble Supreme Court and the High Court have the powers, which are used
in extraordinary circumstances to direct a fresh de novo investigation or
reinvestigation. Even the constitutional Courts exercise the said powers
sparingly and in rare and exceptional circumstances, where it is clearly shown
that, the investigation is tainted with malafides or it is necessary to secure
public confidence in the administration of justice. There can be no dispute
with the proposition that the power of reinvestigation or ordering a fresh
investigation lies only with the constitutional Courts.
19) Considering the peculiar facts of the present case, it is clear that
th
the Petitioners chose not to challenge the impugned Order dated 5 February
2005. Pursuant to the said Order being passed the Petitioner allowed the
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investigation to be carried out and a detailed chargesheet came to be filed.
During this period, the Petitioners for reasons best known to them chose not
th
to specifically challenge the Order dated 5 February 2005 and by their
conduct acquiescence to it. The Petitioners instead filed the discharge
application under Section 239 of the CrPC. The scope and ambit of the Court
to consider an application for discharge is limited and circumscribed by the
section itself. The Court can only consider the report filed under Section 173
of the CrPC and the documents submitted therewith. The learned Magistrate
th
by its Order dated 28 July 2016, was pleased to dismiss the discharge
application on the ground that, the allegations, was such that, the same could
be decided only after taking evidence. It has been observed that, prima facie
there is sufficient evidence against the Accused and that the role played by
each of the Accused can only be ascertain after evidence is led by the
prosecution. While rejecting the discharge application, it was observed that
the complexity of the accused persons will be clear only after the documents
are proved in accordance with law. No fault can be found with the order as
the learned Magistrate was dealing and considering on application for
discharge under Section 239 of the CrPC.
th
20) The said Order dated 28 July 2016 was challenged by Accused
Nos.2, 3, 5 and 6 by filing the revision applications. In the said revision
th
applications, the Sessions Court by Order dated 13 March 2018 was pleased
to discharge Dharmi Swaminathan (Petitioner No.1/Accused No.2), Ms.
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Bhagyalata Panchal (Petitioner No.4/Accused No.6) from the offence
punishable under Section, 403, 406, 409, 468 read with 34 of the IPC. Mrs.
Kavita Vaidhyanathan (Petitioner No.2/Accused No.3) was discharged from
offences punishable under Section 403, 406, 409 read with 34 of IPC. It is the
th
Order dated 13 March 2018 which has been challenged by the present
th
Petitioners Accused Nos.2, 3, 5 and 6. The Order dated 13 March 2018 has
discharged the accused of some Sections/offences. What was considered was a
challenge to the rejection of the discharge application. As noted earlier, the
th
Petitioners had in their discretion not challenged the initial Order dated 5
February 2005 directing reinvestigation or fresh investigation.
21) Considering the aforesaid facts and circumstances this Court is of
the prima facie view that, there is material available on record to proceed
against the Accused. It cannot be said that, the charges are groundless or that
there is no material available. Perusal of the material would in fact indicate a
strong suspicion as against the Accused. This Court while considering a
discharge application has to only see whether a prima facie case is made
available and whether there is material available to proceed. Considering the
facts and circumstances of the case, this Court is of the opinion that, there is
enough material available on record to proceed against the Petitioners.
22) In view thereof, Petition is dismissed.
(RANJITSINHA RAJA BHONSALE, J.)
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