Allahabad High Court
Yogendra Kumar Jhunjhunwala And … vs State Of U.P. Thru. Prin. Secy. Home … on 24 April, 2026
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
Neutral Citation No. - 2026:AHC-LKO:29442
HIGH COURT OF JUDICATURE AT ALLAHABAD
LUCKNOW
APPLICATION U/S 482 No. - 1346 of 2022
Yogendra Kumar Jhunjhunwala And Another
.....Applicant(s)
Versus
State Of U.P. Thru. Prin. Secy. Home Civil Secrtt. And Another
.....Opposite Party(s)
Counsel for Applicant(s)
:
Santosh Srivastava, Kapil Misra
Counsel for Opposite Party(s)
:
G.A., Himanshu Hemant Gupta, Janardan Singh, Sushil Kumar Singh
Court No. - 14
HON'BLE SUBHASH VIDYARTHI, J.
1. Heard Sri Santosh Srivastava, the learned Counsel for the petitioners, Sri Rajiv Kumar Verma, the learned A.G.A.-I appearing on behalf of the State, Sri Sushil Kumar Singh and Sri Janardan Singh, the learned counsel for the opposite party no.2 and perused the records.
2. By means of the instant application filed under Section 482 Cr.P.C. the petitioners have sought quashing of Charge Sheet No.161 of 2013 dated 12.07.2013 submitted in furtherance of Case Crime No.264 of 2023, under Sections 406, 379 I.P.C. Police Station Kotwali Nagar, District Barabanki and the order dated 19.08.2014 passed by learned Chief Judicial Magistrate, Barabanki taking cognizance of the aforesaid offence. The petitioners had challenged the validity of the cognizance order by filing Criminal Revision No.120 of 2014, which has been dismissed by means of a judgment and order dated 05.11.2016 passed by the learned Additional Sessions Judge, Fast Track Court (Offences against Women), Court No.36, Barabanki and the validity of this order has also been challenged through this petition.
3. The aforesaid case has been instituted on the basis of F.I.R. lodged by the opposite party no.2 against unnamed officers and directors of M/s J. R. Organics Limited stating that the opposite party no.2 is the authorized secretary of M/s K. M. Vyapar Private Limited. J. R. Organics Limited has two units at Deva Road, Samaiya Nagar, Barabanki and Kaptanganj, Kushinagar. Some directors and officers of the company had illegally sold away some properties of the company and had misappropriated the money. The Hon’ble High Court of Judicature at Allahabad, sitting at Lucknow, has passed an interim order dated 08.02.2013 in Company Petition No. 19 of 2012 restraining the directors and officers of the company from transferring any property of the company. Some directors and officers of the company have sold away certain properties of the company in an illegal manner and have caused losses to the company worth crores of rupees and they have also misappropriated the money. The illegal sale of goods of the company has also caused a loss of revenue to the government by evasion of sales tax and excise duty.
4. The validity of the F.I.R. was challenged by filing Writ Petition No. 4838 (M/B) of 2013 before this Court and on 10.06.2013, a Division Bench of this Court had passed an interim order, wherein it is recorded that on perusal of the contents of the FIR, it appears that the complainant has raised the dispute of share. It appears that the dispute is purely of a civil nature. With this observation, the Division Bench had granted an interim order staying the arrest of the petitioners till filing of the police report.
5. During investigation the Investigating Officer recorded statement of the complainant. He reiterated the F.I.R. version and further stated that scrap dealers Sayyed and Munna had taken away some iron from the factory as well as some trees worth lakhs of rupees. Three guards were employed in the factory for the past three months. Goods were taken out from the company by trucks during power cuts. The employees used to inform the complainant telephonically. The three persons allegedly employed by the opposite party no.2 also gave statements before the investigating officer. Ram Sumiran Tiwari stated that he was working as a guard in the factory. For the past several days, timber was being taken out from the factory. Sayyed Kabadi and several other persons had taken away some iron goods. Ashutosh Kumar Singh stated that he had been employed to perform duty outside J.R. Organics. He stated that ?Sharma Ji? used to go out in vehicles during power cuts. The goods were taken out on trucks in spite of objection of the employees. He used to inform the owners telephonically. Two other witnesses Shailendra Kumar Verma and Anurag Mishra also stated gave a verbatim same statement.
6. One Sayyed Ali stated that he had sold away junk iron from J.R. Organics in other districts. Krishna Mohan Sharma had handed over certain documents to him in the month of January. He stated that he had taken away iron goods in the months of March, April and May also, but without any documentation.
7. The investigating officer recorded the statement of opposite party no.2 on another occasion wherein he stated that when he had supplied goods to the factory, it was in a working condition. At the time of giving the statement no machine in the factory was in working condition. The machines had been broken down/cut down and heaps of scrap were lying in the factory. The factory had become dilapidated and it could not be restored to running condition, as half of the goods of the factory had already been sold. The opposite party no. 2 stated that he had demanded money on several occasions, but Yogendra Kumar Jhunjhunwala (the applicant no.1) stated that he would not be able to make any payment to the opposite party no.2.
8. Yet another person, Arvind Singh stated that his owner used to send him to the factory to examine whether any goods were being sent out of the factory. He saw that goods were loaded on a DCM vehicle. He objected, but the guard said that he should have no concern with it. Another person, Jai Prakash dittoed this statement.
9. The investigating officer submitted a charge-sheet dated 12.07.2013 against three persons – the petitioners and one Krishna Mohan Sharma, who was employed by the petitioners as a manager, for commission of offences under Sections 379 and 406 I.P.C.
10. The trial court took cognizance of the offences by means of an order dated 19.08.2014, stating that from a perusal of the case diary, prima facie there appears to be sufficient material for taking cognizance of the offence. The trial court further observed that the Hon’ble High Court had passed an interim order which was operative till submission of a charge-sheet. The charge sheet had already been submitted, yet the accused persons were not appearing and, therefore a non-bailable warrant was issued against them at the first instance.
11. After submission of the charge sheet a Division Bench of this court disposed of the Writ Petition No.4838 (M/B) of 2013 by means of an order dated 17.07.2013 which is as follows: –
?Counter affidavit filed on behalf of the respondents.
The petitioners have challenged the F.I.R registered as case crime no. 264 of 2013, under Sections 406, 379 I.P.C P.S Kotwali Nagar, Distt. Barabanki.
This Court heard the matter on 10.06.2013 and observed that the dispute is purely of civil nature. The arrest of the petitioner was, therefore, stayed till filing of the police report under Section 173 Cr.P.C.
From the averments made in the counter affidavit, it is clear that no police report under Section 173 Cr.P.C has been filed by the police in court so far.
Having heard learned counsel for the parties and perusing the record. We do not find any good reason unnecessarily to keep this petition pending and dispose of the same in terms of interim order granted vide order dated 10.06.2013.?
12. Criminal Revision No.120 of 2014 filed by the petitioners as well as the other co-accused Krishna Mohan Sharma was dismissed by means of the impugned judgment and order 05.11.2016 passed by the learned Additional Sessions Judge, Fast Track Court (Offences against Women), Court No.36, Barabanki holding that from the statements recorded during investigation offences under Section 406 and 379 I.P.C. are prima facie made out.
13. The opposite party no.2 has filed a counter affidavit containing elaborate averments regarding the disputes between the parties. It has been stated that M/s K.M. Vyapar had filed a Company Petition No.16 of 2012 in this court, in which an order was passed on 05.10.2012 referring the dispute between the parties to the Mediation and Conciliation Centre of this court. The petition was disposed off and liberty was granted to the parties to file a fresh petition in case the mediation failed. The mediation could not result in a settlement agreement. However, subsequently, the parties have entered into a settlement agreement dated 20.03.2019, a copy whereof has been annexed as with the counter affidavit. Under the agreement J.R. Organics Ltd. was required to pay Rs.32 crores to the companies of Group B, whom the opposite party no.2 represents. However as the settled amount could not be paid within the agreed time, it was enhanced to Rs.42 Crores with mutual consent. The settlement could not be acted upon fully as against the agreed settlement amount of Rs.42 crores, merely Rs.27 crores were paid and the balance amount has not been paid.
14. On 04.08.2022, this court had passed the following order:
?1. In compliance of the order dated 1.8.2022 passed by this Court, petitioners, Sri Yogendra Kumar Jhunjhunwala and Sri Ashish Kumar Jhunjhunwala and Sri Rajiv Kumar, authorized signatory of M/s K.M. Vyapar Private Limited are present and they have been duly identified by their respective counsels.
2. This Court has interacted with the petitioners as well as Sri Rajiv Kumar, and after taking into consideration their stand, is of the opinion that both the parties have bona fide intentions to settle the matter amicably. Parties have left it to the discretion of the Court to fix an amount and terms of the settlement.
3. Having heard Sri S.C. Mishra, learned Senior Advocate, assisted by Sri Santosh Srivastava, and Sri Sudeep Seth, learned Senior Advocate, assisted by Sri Himanshu Hemant Gupta, learned counsel for opposite party no.2, this Court is of the view that the petitioners be directed to pay Rs.17,00,00,000/- (Rupees Seventeen Crores) to M/s K.M. Vyapar Private Limited within a period of six months from today. M/s K.M. Vyapar Private Limited and its associate companies referred as ?Group-A and B? in the agreement dated 20.3.2019 shall cooperate in taking permission from the State Government for selling the land in possession of M/s J.R. Organics Limited, Somaiya Nagar, Dewa Road, Barabanki, U.P. For first three months from today, no interest shall be paid on this Rs.17,00,00,000/- by the petitioners to opposite party no.2, but after three months, on remaining unpaid amount of Rs.17,00,00,000/-, interest @ 10% per annum shall be required to be paid by the petitioners.
4. In case the petitioners fail to pay the amount despite full cooperation by M/s K.M. Vyapar Private Limited and other associate companies referred as “Group-A and B” in the agreement dated 20.3.2019, this petition may be dismissed on the next date and the parties would be left to remedies as may be available to them under law.
5. List this petition on 7.11.2022 for further hearing.
6. Interim order, if any, shall remain in operation till the next date of listing.?
15. The learned counsel for the opposite party no.2 has submitted that the complainant is also a shareholder of the company, the goods whereof were sold under the authority of the petitioners without granting knowledge or consent of the opposite party no.2. Therefore, the offence under Section 379 I.P.C. is made out.
16. This Court need not go into the merits of the claim, counter claim and the justification of non-compliance with the terms of settlement etc. The scope of interference while deciding an application under Section 482 Cr.P.C. is extremely limited. The learned counsel for the opposite party no.2 has rendered valuable assistance to this court by placing reliance on the judgments of the Hon’ble Supreme Court in the cases of C.B.I. v. Aryan Singh: (2023) 18 SCC 399, State of Gujarat v. Dilipsinh Kishorsinh Rao: (2023) 17 SCC 688 and Vishnu Kumar Shukla Vs. State of U.P.: Special Leave Petition (Crl.) NO.8658 of 2017.
17. In CBI v. Aryan Singh: (2023) 18 SCC 399, the Hon?ble Supreme Court held that: –
?6. ? As per the cardinal principle of law, at the stage of discharge and/or quashing of the criminal proceedings, while exercising the powers under Section 482CrPC, the Court is not required to conduct the mini trial. The High Court in the common impugned judgment and order has observed that the charges against the accused are not proved. This is not the stage where the prosecution/investigating agency is/are required to prove the charges. The charges are required to be proved during the trial on the basis of the evidence led by the prosecution/investigating agency.?
18. In State of Gujarat v. Dilipsinh Kishorsinh Rao: (2023) 17 SCC 688, the Hon?ble Supreme Court held that: –
?12. The defence of the accused is not to be looked into at the stage when the accused seeks to be discharged. The expression ?the record of the case? used in Section 227CrPC is to be understood as the documents and articles, if any, produced by the prosecution. The Code does not give any right to the accused to produce any document at the stage of framing of the charge. The submission of the accused is to be confined to the material produced by the investigating agency.
13. The primary consideration at the stage of framing of charge is the test of existence of a prima facie case, and at this stage, the probative value of materials on record need not be gone into. This Court by referring to its earlier decisions in State of Maharashtra v. Som Nath Thapa [(1996) 4 SCC 659] and State of M.P. v. Mohanlal Soni [(2000) 6 SCC 338] has held the nature of evaluation to be made by the court at the stage of framing of the charge is to test the existence of prima facie case. It is also held at the stage of framing of charge, the court has to form a presumptive opinion to the existence of factual ingredients constituting the offence alleged and it is not expected to go deep into probative value of the material on record and to check whether the material on record would certainly lead to conviction at the conclusion of trial.?
19. In Vishnu Kumar Shukla v. State of U.P.: (2023) 15 SCC 502, the Hon?ble Supreme Court held that: –
?15. The extent of scrutiny permissible when an application for discharge is being considered has attracted this Court’s attention on a number of occasions. It is appropriate to take note of the leading precedents on the subject. Insofar as Section 245, CrPC is concerned, the decision of this Court in Ajoy Kumar Ghose v. State of Jharkhand [(2009) 14 SCC 115] is instructive:
?19. The essential difference of procedure in the trial of warrant case on the basis of a police report and that instituted otherwise than on the police report is particularly marked in Sections 238 and 239CrPC on one side and Sections 244 and 245CrPC on the other. Under Section 238, when in a warrant case, instituted on a police report, the accused appears or is brought before the Magistrate, the Magistrate has to satisfy himself that he has been supplied the necessary documents like the police report, FIR, statements recorded under sub-section (3) of Section 161CrPC of all the witnesses proposed to be examined by the prosecution, as also the confessions and statements recorded under Section 164 and any other documents which have been forwarded by the prosecuting agency to the court.
20. After that, comes the stage of discharge, for which it is provided in Section 239CrPC that the Magistrate has to consider the police report and the documents sent with it under Section 173CrPC and if necessary, has to examine the accused and has to hear the prosecution of the accused, and if on such examination and hearing, the Magistrate considers the charge to be groundless, he would discharge the accused and record his reasons for so doing. The prosecution at that stage is not required to lead evidence. If, on examination of the aforementioned documents, he comes to the prima facie conclusion that there is a ground for proceeding with the trial, he proceeds to frame the charge. For framing the charge, he does not have to pass a separate order. It is then that the charge is framed under Section 240CrPC and the trial proceeds for recording the evidence. Thus, in such trial prosecution has only one opportunity to lead evidence and that too comes only after the charge is framed.
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22. In the warrant trial instituted otherwise than the police report, the complainant gets two opportunities to lead evidence, firstly, before the charge is framed and secondly, after the framing of the charge. Of course, under Section 245(2)CrPC, a Magistrate can discharge the accused at any previous stage of the case, if he finds the charge to be groundless.
23. Essentially, the applicable sections are Sections 244 and 245CrPC since this is a warrant trial instituted otherwise than on police report. There had to be an opportunity for the prosecution to lead evidence under Section 244(1)CrPC or to summon its witnesses under Section 244(2)CrPC. This did not happen and instead, the accused proceeded to file an application under Section 245(2)CrPC on the ground that the charge was groundless.
24. Now, there is a clear difference in Sections 245(1) and 245(2) of CrPC. Under Section 245(1), the Magistrate has the advantage of the evidence led by the prosecution before him under Section 244 and he has to consider whether if the evidence remains unrebutted, the conviction of the accused would be warranted. If there is no discernible incriminating material in the evidence, then the Magistrate proceeds to discharge the accused under Section 245(1)CrPC.
25. The situation under Section 245(2)CrPC is, however, different. There, under sub-section (2), the Magistrate has the power of discharging the accused at any previous stage of the case i.e. even before such evidence is led. However, for discharging an accused under Section 245(2)CrPC, the Magistrate has to come to a finding that the charge is groundless. There is no question of any consideration of evidence at that stage, because there is none. The Magistrate can take this decision before the accused appears or is brought before the court or the evidence is led under Section 244CrPC. The words appearing in Section 245(2)CrPC ?at any previous stage of the case?, clearly bring out this position.
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36. The Magistrate has the power to discharge the accused under Section 245(2)CrPC at any previous stage i.e. before the evidence is recorded under Section 244(1)CrPC, which seems to be the established law, particularly in view of the decision in Cricket Assn. of Bengal v. State of W.B. [(1971) 3 SCC 239], as also the subsequent decision of the Bombay High Court in Luis de Piedade Lobo v. Mahadev Vishwanath Parulekar [1983 SCC OnLine Bom 323]. The same decision was followed by Kerala High Court in Manmohan Malhotra v. P.M. Abdul Salam [1994 SCC OnLine Ker 5] and Hon’ble Justice K.T. Thomas, as the learned Judge then was, accepted the proposition that the Magistrate has the power under Section 245(2)CrPC to discharge the accused at any previous stage. The Hon’ble Judge relied on a decision of the Madras High Court in Mohd. Sheriff Sahib v. Abdul Karim Sahib [AIR 1928 Mad 129 (1)], as also the judgment of the Himachal Pradesh High Court in Gopal Chauhan v. Satya [1978 SCC OnLine HP 33].
37. We are convinced that under Section 245(2)CrPC the Magistrate can discharge the accused at any previous stage i.e. even before any evidence is recorded under Section 244(1)CrPC. In that view, the accused could have made the application. It is obvious that the application has been rejected by the Magistrate. So far, there is no difficulty.?
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19. In State of T.N. v. N. Suresh Rajan [(2014) 11 SCC 709], it was observed notwithstanding the difference in language of Sections 227 and 239CrPC, the approach of the Court concerned is to be common under both provisions. The principles holding the field under Sections 227 and 228CrPC are well settled, courtesy, inter alia, State of Bihar v. Ramesh Singh [(1977) 4 SCC 39]; Union of India v. Prafulla Kumar Samal [(1979) 3 SCC 4]; Stree Atyachar Virodhi Parishad v. Dilip Nathumal Chordia [(1989) 1 SCC 715]; Niranjan Singh Karam Singh Punjabi v. Jitendra Bhimraj Bijjaya [(1990) 4 SCC 76]; Dilawar Balu Kurane v. State of Maharashtra [(2002) 2 SCC 135]; Chitresh Kumar Chopra v. State (NCT of Delhi) [(2009) 16 SCC 605]; Amit Kapoor v. Ramesh Chander [(2012) 9 SCC 460]; Dinesh Tiwari v. State of U.P. [(2014) 13 SCC 137]; Dipakbhai Jagdishchandra Patel v. State of Gujarat [(2019) 16 SCC 547] and State (NCT of Delhi) v. Shiv Charan Bansal [(2020) 2 SCC 290]. We need only refer to some, starting with Prafulla Kumar Samal, where, after considering Ramesh Singh [State of Bihar v. Ramesh Singh, (1977) 4 SCC 39], K.P. Raghavan v. M.H. Abbas [1966 SCC OnLine SC 76] and Almohan Das v. State of W.B. [1968 SCC OnLine SC 85], it was laid down as under:
?10. Thus, on a consideration of the authorities mentioned above, the following principles emerge:
(1) That the Judge while considering the question of framing the charges under Section 227 of the Code has the undoubted power to sift and weigh the evidence for the limited purpose of finding out whether or not a prima facie case against the accused has been made out.
(2) Where the materials placed before the Court disclose grave suspicion against the accused which has not been properly explained the Court will be fully justified in framing a charge and proceeding with the trial.
(3) The test to determine a prima facie case would naturally depend upon the facts of each case and it is difficult to lay down a rule of universal application. By and large however if two views are equally possible and the Judge is satisfied that the evidence produced before him while giving rise to some suspicion but not grave suspicion against the accused, he will be fully within his right to discharge the accused.
(4) That in exercising his jurisdiction under Section 227 of the Code the Judge which under the present Code is a senior and experienced court cannot act merely as a Post Office or a mouthpiece of the prosecution, but has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before the Court, any basic infirmities appearing in the case and so on. This however does not mean that the Judge should make a roving enquiry into the pros and cons of the matter and weigh the evidence as if he was conducting a trial.?
20. In Indian Oil Corpn. v. NEPC India Ltd.: (2006) 6 SCC 736, the Hon?ble Supreme Court referred to numerous precedents dealing with the principles relating to exercise of jurisdiction under Section 482 of the Code of Criminal Procedure to quash complaints and criminal proceedings and summarized the principles as follows: –
?(i) A complaint can be quashed where the allegations made in the complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie constitute any offence or make out the case alleged against the accused.
For this purpose, the complaint has to be examined as a whole, but without examining the merits of the allegations. Neither a detailed inquiry nor a meticulous analysis of the material nor an assessment of the reliability or genuineness of the allegations in the complaint, is warranted while examining prayer for quashing of a complaint.
(ii) A complaint may also be quashed where it is a clear abuse of the process of the court, as when the criminal proceeding is found to have been initiated with mala fides/malice for wreaking vengeance or to cause harm, or where the allegations are absurd and inherently improbable.
(iii) The power to quash shall not, however, be used to stifle or scuttle a legitimate prosecution. The power should be used sparingly and with abundant caution.
(iv) The complaint is not required to verbatim reproduce the legal ingredients of the offence alleged. If the necessary factual foundation is laid in the complaint, merely on the ground that a few ingredients have not been stated in detail, the proceedings should not be quashed. Quashing of the complaint is warranted only where the complaint is so bereft of even the basic facts which are absolutely necessary for making out the offence.
(v) A given set of facts may make out: (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. A commercial transaction or a contractual dispute, apart from furnishing a cause of action for seeking remedy in civil law, may also involve a criminal offence. As the nature and scope of a civil proceeding are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal offence or not.?
(Emphasis added)
21. When we examine the facts of the present case in light of the law laid down by the Hon?ble Supreme Court, it appears that the F.I.R alleges the sale of certain properties of a company in violation of an interim order passed by this court. The violation of an order passed by this court amounts to committing contempt of the court, for which punishment is prescribed under Section 12 of the Contempt of Courts Act.
22. The applicants have been charged with the commission of offences under Sections 379 and 406 I.P.C. Section 379 contains punishment for the offence of theft and theft is defined in Section 378 I.P.C. which is as follows: – ?378. Theft.?
Whoever, intending to take dishonestly any moveable property out of the possession of any person without that person’s consent, moves that property in order to such taking, is said to commit theft.?
23. The F.I.R. and the statements recorded during investigation do not allege that any movable property has been taken out of the possession of the complainant. The goods were taken out from the premises of a company, of which the petitioners were in control. Moving out or taking out properties of the company would not constitute the offence defined under Section 378 IPC. The statements recorded during the investigation and referred to above do not indicate that the goods sold were in possession of the complainant and that the goods were taken out of the possession of the petitioner. Therefore, the offence punishable under 379 IPC is not made out from the facts of the present case.
24. Section 406 I.P.C. contains punishment for the offence of criminal breach of trust. It is not the case of the complainant that he had entrusted any property to the petitioners. In the absence of entrustment of any property, the question of breach of trust does not arise.
25. The statements of the witnesses have been referred to above, which shows that witnesses have stated that some goods were moved out of the unit but none of the witnesses has stated about any act committed by any of the petitioners in movement of the goods. Therefore, from the averments made in the FIR and the statements of the witnesses, the offences punishable under Sections 379 and 406 IPC are not made out. The trial court has taken cognizance of the offence in a mechanical manner, without examining that the contents of the F.I.R. and the statements of the witnesses do not make out ingredients of the offences punishable under Sections 379 and 406 IPC. Accordingly, the cognizance order also becomes unsustainable in law and is quashed.
26. Consequently, the quashing of the cognizance order and the charge sheet the entire proceedings of Case Crime No.264 of 2023, under Sections 406, 379 I.P.C. Police Station Kotwali Nagar, District Barabanki are hereby quashed.
27. With these observations/directions the application stands allowed.
28. It is clarified that the observations made in this order are for the purpose of examining the validity of the charge sheet and the summoning order only, and the same would not affect the rights and interests of the parties in any other proceedings regarding their rights or interests in the company or its properties.
(Subhash Vidyarthi,J.)
April 24, 2026
Ram.