DEVANGKUMAR PARESHBHAI VYAS vs STATE OF GUJARAT

R/CR.MA/7663/2022 JUDGMENT DATED: 28/07/2026
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE
FIR/ORDER) NO. 7663 of 2022

FOR APPROVAL AND SIGNATURE:


HONOURABLE MR.JUSTICE P. M. RAVAL

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Approved for Reporting Yes No
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DEVANGKUMAR PARESHBHAI VYAS
Versus
STATE OF GUJARAT & ANR.
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Appearance:
MR PRATIK B BAROT(3711) for the Applicant(s) No. 1
MR ROHAN SHAH, APP for the Respondent(s) No. 1
RULE SERVED for the Respondent(s) No. 2
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CORAM: HONOURABLE MR.JUSTICE P. M. RAVAL

Date : 28/07/2026

ORAL JUDGMENT
1. By way of this application under Section 482 of the Code of
Criminal Procedure, 1973, the applicant has prayed for the
following reliefs.
“(B) Your Lordships may be pleased to quash and set
aside the impugned FIR being C.R. No.
11206062210543 of 2021 registered with Satlasana
Police Station, District Mehsana, for the offences
punishable under Sections 406, 420, 120B of the
Indian Penal Code and Sections 13 and 14 of the
Securities Contracts Regulation Act, 1956 and
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Sections 66(C) and 66(D) of the Information
Technology Act, along with all consequential
proceedings arising therefrom.
(C) Pending admission, hearing and final disposal of
the present application, Your Lordships may be
pleased to stay the proceedings of the impugned FIR
being C.R. No. 11206062210543 of 2021 registered
with Satlasana Police Station, District Mehsana, for
the offences punishable under Sections 406, 420,
120B of the Indian Penal Code, and Sections 13 and
14 of the Securities Contract Regulation Act, 1956
and Sections 66(C) and 66(D) of the Information
Technology Act, along with all consequential
proceedings arising therefrom.”
2. The case of the prosecution in nutshell, as can be
reproduced from the impugned FIR is as under:
The fact in this matter is such that, accused No.6 had
hired accused Nos.1 to 5 and by installing a mobile phone
application namely Market Pulse in the Mobile Phone and
Tablet, hatched conspiracy of causing financial loss to the
Government of India by doing business of buying and
selling of shares without any type of license of Stock
Exchange and maintained accounts of increase and
decrease in the share prices through Havala. Thus, they
hatched conspiracy with intention of causing financial loss
to the Government of India by committing financial fraud,
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R/CR.MA/7663/2022 JUDGMENT DATED: 28/07/2026
violating the rules of SEBI and as the accused Nos.1 to 3
arrested at the place with muddamal of Mobile Phones
Nos.5, Tablet No.-01 and note books in total muddamal of
worth Rs. 12,000/- and as the accused Nos. 4 and 6 fled
from the place and as the accused No.5 was not found at
the place, they have abetted each other in committing the
offence and this is the complaint regarding the same.
My name is Mukeshkumar Kamjibhai, unarmed Police
Constable, B.No.687, Service at Satlasana Police Station,
Taluka- Satlasana, District: Mehsana, Mobile No.
9662263533.
The fact of my complaint is such that, today, I along
with you and Head Constable, Dineshbhai Jethabhai
B.No.366, Laxmanji Amrutji B.No.285, A.P.C. Ravikumar
Devendrakumar, B.No.1074 were present at the Police
Station. Meanwhile, you received information that, some
persons are operating Dabba trading by using mobile phone
in a farm situated near the house of Thakorji Kiaranji
Parthiji, in the area of Khadiya in the outskirt of Vaghar
Village and that they are present there. On the basis of
such information, you along with the staff members left the
Police Station and arrived at Vaghar Village and upon
personally verifying the received information at the place
mentioned in the information, it was found to be true.
Therefore, you came to Vaghar Village and summoned two
panchas and made them aware about the aforesaid facts
and upon going and seeing the place mentioned in the
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information along with these Panchas, about five persons
were holding mobile phone, tablet and notebooks in their
hands and were doing something in the phones. Therefore,
in order to catch them, as we condoned them and raided
there, they threw the mobile phones and Notebooks from
their hands and started fleeing. Three persons out of them,
were arrested and two persons fled from there. Upon asking
the name and address of these three persons in presence of
the panchas, out of the three, first persons stated his name
as Thakor Ajitji Parthiji Pratapji age 21 years residing at
Vaghar, Taluka Satlasana. Upon asking the second person
about his name, he stated his name as Thakorji Prakashji
alias Popatji Vinuji alias Amratji Karanaji, age 20 years,
residing at Vaghar (Kesharpura seem), Ta.Satlasana. Upon
asking name and address of the third person, he stated his
name as, Thakor Sureshji Monghaji Javanji age 27 years
residing at Vaghar Village, Ta. Satlsana. Moreover, upon
collecting the mobile phones and notebooks which the five
persons threw at the place and upon seeing the same, there
were total four notebooks and other papers containing
mobile numbers typed in scattered manner and other
writings, four mobile phone and one tablet were found. All
the notebooks, papers and mobile phones were collected
and were seized for the investigation. Upon interrogating
and switching on the Oppo Company mobile phone of
Thakor Sureshji, there are sheets indicating increase and
decrease of share market were found in open and
operational condition in an application namely Market
Pulse which was operated on the account of Suresh Thakor,
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R/CR.MA/7663/2022 JUDGMENT DATED: 28/07/2026
Mo.No.9904271980 and email ID in English
[email protected]. Upon seeing the IMEI
number of this mobile phone, they are IMEI (1)
869495053250133/57 abd IMEI (2) 869495053250125/57.
The value of the same was counted Rs.3,000/-. Moreover,
Upon switching on the Oppo company mobile phone of the
other arrested person Thakor Ajitji, sheets indicating
increase and decrease of share market were found in open
and operational condition on the main screen of this phone
and Ajit, Mo.No. 6359086560 is written in my account of a
mobile application namely Market Pulse. The IMEI number
of this mobile phone are IMEI (1) 863087035731671 and
IMEI (2) 863087035731663. The value of the same was
counted Rs.1000/-. Moreover, upon frisking Thakor
Prakashji alias Popatji Vinuji alias Amarat Karanaji, a basic
Lava company mobile phone was found from his pocket.
The IMEI numbers of the same are (1) 354774117797508
and IMEI (2) 354774117797516. The value of the same was
counted at Rs.500/-. Moreover, a Lenovo company tablet
was lying on the ground which was password protected and
therefore, it was seized valuing it’s worth Rs.1500/-. There
were two Vivo company android phones both were password
protected, both the phones were seized valuing their worth
Rs.3000/- each i.e. total of Rs.6000/-. The notebook seized
from these persons at this farm containing accounts and
figures of Dabba trading was seized valuing it’s worth
Rs.00/00/-. Moreover, upon frisking this person no cash
was found. Panchnama regarding the said muddamal was
drawn in my presence from 14/30 to 15/45 hours and was
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R/CR.MA/7663/2022 JUDGMENT DATED: 28/07/2026
seized for the investigation. Moreover, upon interrogating
the three arrested persons about the persons who fled from
the scene, they have stated that, they were Thakor Manishji
Virsangji and that they do not know the name and address
of the other person. Moreover, they state that, this business
of Dabba Trading is run by Rizvanbhai Sheikh Bhalakvala
by hiring individuals (on salary).
(1) Thakor Ajitji ParthIjI Pratapji age 21 years, residing
at Vaghar, Taluka Satlasana. (2) Thakorji Prakashji alias
Popatji Vinuji alias Amratji Karanaji, age 20 years, residing
at Vaghar (kesharpura seems), Ta. Satlasana. (3) Thakor
Sureshji Monghaji Javanji age 27 years residing at Vaghar
Village, Ta. Satlasana, Thakor Manishji Virsangji and the
absconding person had committed offence by installing a
mobile phone application namely Market Pulse in their
Mobile Phones, hatched conspiracy of causing financial loss
to the government of India by doing business of buying and
selling of shares without any type of license of Stock
Exchange and maintained accounts of increase and
decrease in the share prices through Havala. In this
manner they hatched conspiracy with intention of causing
financial loss to the Government of India by committing
financial loss to the Government of India by committing
financial fraud and violating the rules of SEBI. Therefore, it
is my complaint against the aforesaid three persons who got
arrested with muddamal of Mobile Phones Nos. -05 Tablets
Nos. -01 and notebooks worth Rs. 12000/- and Thakor
Manishji Virsangji and one other person who is absconding
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R/CR.MA/7663/2022 JUDGMENT DATED: 28/07/2026
along with Rizvanbhai Sheikh Bhalakvavala and all the
persons who may be found as accused in the investigation
under Section 406, 420, 120B of IPC and under Sections
13, 14 of the Securities Contract Regulation Act, 1956. My
witnesses are the fellow staff members and the panch
witnesses.
3. Heard learned advocate Mr. A.P. Chokse appearing on
behalf of Mr. Pratik B. Barot for the applicant and learned
APP Mr. Rohan Shah for the respondent–State.
4. Learned advocate for the applicant, at the outset,
submitted that the present FIR is not maintainable as the
police constable could not have filed FIR for the offence
punishable under the Securities Contract (Regulation) Act,
1956. Learned advocate in the alternatively, submitted that
even if the entire case of the prosecution is believed or
accepted to be true, none of the ingredients of provisions of
Sections 406, 420 of the Indian Penal code are spelt out.
4.1 Learned advocate further submitted that in view even
if the of Section 26 of the Act, 1956, present F.I.R. is
allowed to be investigated and the investigating officer is
allowed to be filed charge-sheet, in that event also, the
court below would not be able to take any cognizance under
the provisions of the Act, 1956 on a police report.
4.2 To substantiate the said contention, learned advocate
for the petitioners has relied on the decision of the
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R/CR.MA/7663/2022 JUDGMENT DATED: 28/07/2026
coordinate Bench of this Court in case of Vipulkumar
Avantilal Shah v. State of Gujarat being Special Criminal
Application No. 1781 of 2018 decided on 15th March, 2018.
5. Per contra , learned Additional Public Prosecutor Mr.
Rohan Shah submitted that present application under
Section 482 of the Code of Criminal Procedure, 1973 may
not be entertained as the cognizable offence has been
disclosed in the F.I.R. and that serious allegations are made
and the offence alleged are serious in nature and therefore,
at this stage, this application may not be entertained.
5.1 According to learned Additional Public Prosecutor
the ingredients of offences under Sections 406 and 420 of
out the IPC and other offences are already spelt and
therefore, this Court may not exercise its extra-ordinary
jurisdiction conferred under Section 482 of the Code, 1973.
5.2 By making above submissions, learned Additional
Public Prosecutor requested this Court to dismiss the
present application.
6. Having heard learned advocates for the respective
parties and having gone through the materials produced on
record, the short question that falls for consideration of this
Court is the Court would be able to take whether
cognizance of any offence punishable under the Act, 1956
except private complaint filed by Central Government, State
Government, Security & Exchange Board of India or
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recognized stock Exchange or person?
7. The Coordinate Bench in Vipulkumar Avantilal Shah
(supra) held as under:
"8. I find merit in both the submissions put forward by the
learned counsel. Section 26 of the Act, 1956 reads as
under:-
"26. Cognizance of offences by courts.
(1) No cognizance court of shall take any offence or or
punishable under this Act any rules regulations
byelaws made thereunder, save on a or complaint
made by the Central Government Government or or
State the Securities and Exchange Board of India or a
recognized stock exchange or by any person.
(2) No court inferior to that of Court of Session shall1
a any offence punishable try under this Act."
9. A plain reading of Section 26 of the Act, 1956, referred
above, would suggest that no Court will be able to to take
cognizance of any offence punishable under the Act except on
a or State Government and Exchange or the Securities of
India or a complaint made by the Central Government Board
recognized Stock Exchange or a person.
10. Let me assume for the moment that the respondent
no.2 herein would fall within the ambit of 'any person'. The
issue which falls for my consideration is, whether the court
before whom the charge-sheet is filed can take cognizance of
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the offence. The word 'complaint' figuring under Section 26 of
the Act means, the before Section 2 (d) a court complaint in
writing as defined under of the Code of Criminal Procedure. I
am conscious of the fact that Section 25 makes the offence
under Section 23 of the Act a cognizable offence. Since
Section 23 is a cognizable offence, the police would definitely
have the power to investigate. To this extent, there is no
problem. The police has investigated, charge-sheet is filed.
Now the stage has come for the court to take cognizance. In
my view, the Sessions Court will not be able to take
cognizance on the police report in view of the specific bar
contained in Section 26 of the Act. The same is the position
with Section 26 of the Securities and Exchange Board of
India Act, 1992.
"Section 26 reads thus: "26. Cognizance of offences by
courts.
(1) No court shall take cognizance of any offence
punishable under this Act or any rules or regulations
made thereunder, save on a complaint made by the
Board.
(2) No court inferior to that of a court of session shall try
any offence punishable under this Act."
11. The law in this regard is well settled. Although the
police has power to investigate the offence alleged against
the applicant and charge-sheet has been filed, the Court will
not be able to take cognizance in view of the specific bar. The
investigation carried out by the police can be used for the
purpose of filing a complaint in writing before the appropriate
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court. To be precise, whatever materials have been collected
by the Investigating Officer could be used by the authority for
the purpose of filing a complaint before the competent court."
9. So far as allegation of Sections 406, 420 and 120B of the
Indian Penal Code is concerned, in my view, if the same is read
over it is, then also ingredients of those provisions do not exist
and thus, same cannot be allowed to stand.
10. As regards Sections 66(C) and 66(D) of the Information
Technology Act, 2000, Section 66(C) provides punishment for
identity theft, whereas Section 66(D) provides punishment for
cheating by personation by using a computer resource.
However, it is not clear as to how the aforesaid provisions are
attracted to the case of the present applicant, whose name does
not find place in the FIR and has surfaced only during the
course of investigation. A plain reading of the FIR does not
disclose the ingredients of the offences punishable under
Sections 66(C) and 66(D) of the Information Technology Act,
2000. Therefore, prima facie, the said provisions are not
attracted to the facts of the present case.
10.1 In view of the above discussion and settled position of
law, the present application deserves to be allowed. The
impugned F.I.R. along with the all consequential proceedings
therefrom are hereby quashed and set aside out.
11. It is, however, clarified that the so-called material collected
by the investigating agency during the investigation may be
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used to the authority concerned to initiate appropriate
proceedings against the applicant in accordance with law.
12. The application stands allowed. Rule is made absolute,
accordingly.
(P. M. RAVAL, J)
MOHD SAIF ULLAH
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