Initiation of Section 340 CrPC proceedings for obtaining interim injunctions through fabricated documents and false pleadings.

The Plaintiff filed a suit for permanent injunction and damages, alleging that former employees (Defendants 2-20) breached identical Non-Disclosure Agreements (NDAs) by joining a competitor, Defendant 1.

Based on these pleadings, the Court granted an ad-interim injunction on 04.04.2022.

It later emerged that several Defendants had not signed the NDAs relied upon, and some (Defendants 14 and 18) had actually rejoined the Plaintiff company during the litigation.

Defendant 19 alleged his signatures were forged, supported by a forensic report suggesting "computerized transplantation".

The Plaintiff withdrew the suit on 20.03.2023, following which Defendant 1 filed the present application under Section 340 CrPC alleging perjury and fraud upon the court.

1. Whether the Plaintiff intentionally made false claims and furnished fabricated documents during judicial proceedings to attract the provisions of Section 195(1)(b) CrPC.

2. Whether it is expedient in the interests of justice to initiate an inquiry under Section 340 CrPC against the Plaintiff.

The court applied Section 340 read with Section 195(1)(b) of the CrPC, which mandates that a court must form an opinion that an inquiry into offences against public justice (such as perjury or forgery of documents given in evidence) is "expedient in the interests of justice".

Reliance was placed on Section 191, 193, and 209 of the IPC regarding the making of false claims and fabricating evidence.

The Court followed the precedent in Iqbal Singh Marwah v. Meenakshi Marwah, which established that the court's discretion to file a complaint should be exercised by weighing the impact of the offence on the administration of justice rather than the mere magnitude of personal injury.

The Court found a prima facie case of false averments because the Plaintiff’s pleadings were inconsistent with its own documentary evidence; specifically, it claimed all Defendants executed NDAs while filing unsigned copies for many.

The Court noted that the Plaintiff secured a beneficial stay order for four months based on these false claims.

The Court observed that despite allegations of forgery by Defendant 19 and forensic evidence of "transplantation," the Plaintiff failed to produce original NDAs for several parties.

The Court reasoned that the statutory ingredients of Section 195(1)(b)(i) were satisfied because the false statements were verified and placed before the Court with the specific intent to mislead the Court into granting a favorable order.

The Court directed the Registrar General of the High Court of Delhi to prepare a formal complaint under Section 195 read with Section 340 CrPC and file it before the competent Magistrate for further action.

The Court clarified that the Trial Court remains free to make its own final determination on the evidence without being bound by these preliminary observations.