IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL Nos.21072125 OF 2011
C.B.I. New Delhi ….Appellant(s)
B.B. Agarwal & Ors. etc. ….Respondent(s)
J U D G M E N T
Abhay Manohar Sapre, J.
- These appeals are directed against the final
judgment and order dated 18.04.2009 passed by
the High Court of Delhi at New Delhi in Crl.MC
Nos.572230 of 2006 & Crl.MA No.9675 of 2006,
Crl.MC No.74 of 2007 & Crl.MA Nos.23536 of
2007, Crl.MC No.80 of 2007 & Crl.MA Nos.25960
of 2007 and Crl.MC No.2376 of 2007 & Crl.MA
Nos.834142 of 2007 whereby the High Court
allowed the criminal petitions filed by the
respondents herein under Section 482 of the Code
of Criminal Procedure, 1973 (hereinafter referred to
as “Cr.P.C.”) and quashed the criminal proceedings
in CBI Case No.RC.4(A)/94CBI/BSC/DLI pending
before the Special Judge, Tis Hazari, Delhi against
the respondents herein.
- A few facts need mention hereinbelow to
appreciate the short controversy involved in these
- In the year 199293, it came to the notice of
Investigating Agency (CBI) that two Limited
Companies, namely, M/s New Beam Ferro Alloys
Ltd.(NBFAL) Respondent No. 6 and M/s West
Coast Brewers & Distillers Ltd.(WCBDL)
respondent No. 7 came out with public issue of their
companies and in execution of the public issue,
these Companies were alleged to have defrauded the
Punjab National Bank (PNB), PNB House Branch,
Sir P.M. Road, Fort, Mumbai to the tune of Rs.15
- It may not be necessary to set out the details
as to how the alleged defalcation was done by the
said two Companies.
- Suffice it to say, the investigation was carried
out by the CBI which led to filing of a criminal case
bearing No. RC4(A)/94CBI/BSC/DLI against the
Directors of the companies and the officials of PNB
under Section 120B read with Sections 409, 420,
468, 471 of the Indian Penal Code, 1860
(hereinafter referred to as “IPC”) read with Section
13(2) read with Section 13(i) (c) and (d) of the
Prevention of Corruption Act, 1988 (hereinafter
referred to as “PC Act”) in the designated C.B.I.
- The charge sheet was filed against 12 accused
persons out of which 6 are individuals and
remaining are the Companies. It is not in dispute
that during the pendency of this case, four
individual accused persons have died. It is also not
in dispute that out of the accusedCompanies, the
names of two companies, namely, WCBDL
(respondent No. 7) and Surlex Dignostic Ltd.
(respondent No. 8) have been deleted vide order
- It is not in dispute that PNB had also filed two
civil suits bearing Nos. 342/1995 and 2740/1995
against the CompaniesWCBDL(R7) and NBFAL
(R6) and its Directors in Bombay High Court for
recovery of the outstanding dues and for settlement
of the accounts which were later transferred to the
Debt Recovery Tribunal, Mumbai (OA
No.3174/2000) for trial. It is also not in dispute that
during the pendency of these civil suits and
pursuant to orders passed therein directing the
parties to undertake reconciliation of the accounts,
the PNB and the two companies through their
Directors reconciled their accounts and
compromised the matter by entering into a onetime
settlement on 06.06.2006. The consent application
in O.A. No.3174 of 2000 was accordingly filed by the
parties in DRT, Mumbai for disposal of the OA in
terms of the settlement arrived at between them.
- The DRT by its order dated 11.05.2006
accepted the settlement and accordingly disposed of
OA No. 3174/2000 in terms of settlement. (See
documents filed in IA12323/2019). In terms of
settlement order, the two companies were liable to
pay a total sum of Rs.12.20 crores to PNB, which
the two Companies, through their Directors, paid to
the PNB. It is not in dispute that now there are no
outstanding dues payable by these two Companies
to the PNB and the order of DRT stood complied
- It is with these background facts, the 12
respondents(accused) filed the petitions in the High
Court of Delhi under Section 482 of Cr.P.C. seeking
to quash the criminal proceedings filed against
- By impugned order, the High Court allowed
the petitions and quashed the criminal proceedings,
which has given rise to filing of the present appeals
by way of special leave by the CBI in this Court.
- So, the short question, which arises for
consideration in these appeals, is whether the High
Court was justified in allowing the petitions filed by
the respondents under Section 482 of the Cr.P.C
and quashing the criminal proceedings.
- Heard learned counsel for the parties.
- Having heard the learned counsel for the
parties and on perusal of the record of the case, we
find no merit in these appeals.
- In our considered opinion, having regard to the
background facts stated above, we find no good
ground to interfere in the impugned order.
- The High Court was of the view that on
resettlement of accounts, the parties obtained the
consent decree from DRT and paid the entire sum,
therefore, there is no live issue, which now survives.
The High Court then examined the question as to
whether the issue of criminality is involved so as to
allow the Trial Court to continue on its merits.
After examining this issue with reference to charges
and documents, the High Court held that no
criminality issue is found involved notwithstanding
the settlement of the case between the parties.
- We are also of the view that there arises no
occasion to prosecute the respondents as was
rightly held by the High Court while quashing the
criminal case against the respondents.
- Learned counsel for the appellant, placing
reliance on the decision of this Court in Rumi
Dhar(Smt.) vs. State of West Bengal & Anr.,
(2009) 6 SCC 364 contended that notwithstanding
settlement of the civil suits by the parties, the
criminal case out of which these appeals arise has
to be brought to its logical end one way or the other
on merits and the High Court was, therefore, not
right in quashing the chargesheet at its threshold
under Section 482 of the Cr.P.C.
- We find no merit in her submission. When we
take into account the entire undisputed controversy
mentioned above, we also find that there is no
criminality issue surviving qua those accused, who
are alive so as to allow the prosecuting agency to
continue with the criminal trial on merits. Indeed, it
would be an abuse of process, as was rightly held
by the High Court to which we concur.
- In view of the foregoing discussion, we find no
merit in these appeals. The appeals are accordingly
.………...................................J. [ABHAY MANOHAR SAPRE]……………………………………….J.
[L. NAGESWARA RAO]
February 18, 2019