Mr. Amit Suresh Lodha vs. The State Of Telangana

Facts

The petitioners, directors of a company, filed a Criminal Petition under Section 482 of the Cr.P.C. seeking to quash proceedings against them in C.C. No. 185 of 2022 before the XIV Additional Chief Metropolitan Magistrate, Nampally, Hyderabad. The proceedings were initiated for alleged offences under Sections 406, 420 read with Sections 34 and 120B of the Indian Penal Code. The petitioners claimed they were falsely implicated and had no connection with the payment of GST. The company, accused No. 1, was stated to be under Corporate Insolvency Resolution Process (CIRP). The State contended that the police had investigated and filed a charge sheet, and thus the proceedings should not be quashed at this juncture.

Held

The Court noted that the petitioners were erstwhile directors of the company and the matter related to the payment of GST by the company, not solely by the petitioners. It was also observed that the company (accused No. 1) was under CIRP. Taking these facts and circumstances into consideration, the Court deemed it appropriate to dispense with the personal appearance/attendance of the petitioners (accused Nos. 2 to 4) before the trial court in C.C. No. 185 of 2022. Their presence would only be required unless their presence was necessitated for a specific purpose or at the time of recording their statement under Section 313 Cr.P.C. and on the date of pronouncement of judgment. Furthermore, the petitioners were granted liberty to file an application before the trial court seeking their discharge. The trial court was directed to dispose of such an application on merits within three weeks from the date of its filing, without being influenced by any observations made by the High Court.

Key Issues

1. Whether the proceedings initiated under Sections 406, 420 read with Sections 34 and 120B of the Indian Penal Code against the petitioners, who were erstwhile directors of a company facing CIRP, should be quashed, considering their alleged lack of involvement in the company's GST payment obligations. Petitioner's Contention: The petitioners argued that they were falsely implicated, had committed no offences as alleged by respondent No. 2, and were not concerned with the payment of GST. They sought to quash the proceedings against them. Revenue's Contention: The learned Assistant Public Prosecutor contended that the proceedings against the petitioners could not be quashed at this stage as the police had duly investigated the case and filed a charge sheet against them. Therefore, the Criminal Petition should be dismissed.