Endorsements verifying a non-existent insured create strong suspicion warranting trial, not quashing or discharge.

The matters arose from the same FIR, C.R. No. I-110 of 2008 registered at Sayajiganj Police Station, Vadodara City, alleging offences under Sections 406, 420, 467, 468 and 471 of the IPC.

The principal accused, Mukesh Mahendrabhai Darji, allegedly obtained an LIC policy for a sum assured of ₹5 lakh by misrepresenting his identity, producing another person’s School Leaving Certificate and subsequently submitting a forged death certificate to claim the policy proceeds.

Investigation indicated that the policy had been issued in the name of a non-existent person, Yagnesh Mahendrabhai Darji; statements of the Talati-cum-Mantri and Sarpanch supported this conclusion.

The petitioner in Special Criminal Application No. 9928 of 2016 was the LIC agent who had allegedly supplied a stamped and signed proposal form and had endorsed that he had explained the proposal questions to and recorded the answers of the proposer. The applicant in Criminal Misc. Application No. 10345 of 2017 was the LIC Development Officer who endorsed that he was satisfied with the proposer’s identity after making independent inquiries.

Both applicants sought quashing of the FIR and consequential proceedings, or discharge. The trial court rejected the agent’s discharge application on 15 July 2016, and the revisional court affirmed that order on 9 September 2016. The Development Officer separately sought quashing under Section 482 of the CrPC.

Whether the FIR and charge-sheet disclosed sufficient prima facie material against the LIC agent to justify continuation of the criminal proceedings and refusal of discharge.

Whether the Development Officer’s endorsement verifying the identity of the proposer constituted prima facie material warranting his trial for the alleged offences.

Whether the High Court should exercise its inherent jurisdiction under Section 482 of the CrPC or writ jurisdiction under Article 226 of the Constitution to quash the FIR, charge-sheet or the concurrent orders refusing discharge.

Whether the absence of express allegations or charges under Sections 34, 114 or 120B of the IPC excluded the applicants’ possible complicity in the alleged fraud.

The Court applied Section 482 of the CrPC and Article 226 of the Constitution, holding that their exceptional jurisdiction is to be exercised sparingly to prevent abuse of process or secure the ends of justice.

It relied on State of Haryana v. Bhajan Lal, AIR 1992 SC 604, particularly the illustrative categories permitting quashing where the allegations, even if accepted in full, do not disclose an offence or where continuation would amount to abuse of process.

The Court considered the ingredients of Sections 406, 420, 467, 468 and 471 IPC concerning criminal breach of trust, cheating, forgery and use of forged documents.

At the discharge stage under Section 227 CrPC, the court must sift the prosecution material to determine whether a prima facie case or strong suspicion exists, without conducting a mini-trial; the Court relied on Central Bureau of Investigation v. Aryan Singh, 2023 (0) AIJEL-SC 70780, and Kanchan Kumar v. State of Bihar, (2022) 9 SCC 577.

The Court also noted that charges may be altered or added at any stage under Section 216 CrPC.

The Court held that the agent’s written endorsement represented that he had personally explained the proposal and recorded the proposer’s answers, despite the prosecution material indicating that the named proposer was non-existent.

His claim that he had merely trusted the principal accused, together with the latter’s exculpatory affidavit and LIC’s internal vigilance report, raised disputed questions of fact that could not be conclusively determined in proceedings under Section 482 or at the discharge stage.

Similarly, the Development Officer expressly certified that he was satisfied with the proposer’s identity on the basis of independent inquiries. Since the policy was allegedly issued in the name of a fictitious person, this endorsement furnished prima facie material and generated a strong suspicion of involvement.

The Court further held that the omission of Sections 34, 114 or 120B IPC from the FIR or charge-sheet did not by itself exclude liability, since the trial court could alter or add charges under Section 216 CrPC if the evidence so warranted.

In view of the completed investigation, filed charge-sheet and concurrent orders refusing discharge, and absent any perversity, illegality or jurisdictional error, the Court declined to conduct a mini-trial or reassess the evidentiary merits.

Criminal Misc. Application No. 10345 of 2017 and Special Criminal Application No. 9928 of 2016 were rejected; the trial court’s order dated 15 July 2016 and the revisional order dated 9 September 2016 were upheld.

Rule was discharged, interim relief stood vacated, and the trial court was directed to proceed with Criminal Case No. 38896 of 2008 in accordance with law, uninfluenced by the observations in the judgment.