CRL.M.C. 589/2023 Page 1 of 18

* IN THE HIGH COURT OF DELHI AT NEW DELHI

Reserved on: 08.09.2026

Pronounced on: 24.09.2026

Uploaded on: 24.09.2026

# CNR No. DLHC010023702023

+ CRL.M.C. 589/2023 & CRL.M.A. 2291/2023

RITA SINGH & ANR. .....Petitioners

Through: Ms. Rebecca John, Sr. Adv. with Mr.

Chinmay Kanojia and Ms. Anushka

Advs.

versus

CENTRAL BUREAU OF INVESTIGATION .....Respondent

Through: Mr. Rajesh Kumar, SPP along with

Mr. Changez Khan, Adv.

CORAM:

HON'BLE MS. JUSTICE MADHU JAIN

JUDGMENT

MADHU JAIN, J.

1.The present petition under Section 482 of the Code of Criminal

Procedure, 1973 (hereinafter referred to as the ‘CrPC’) has been filed by the

Petitioners, Ms. Rita Singh and Ms. Natasha Singh, assailing the judgment

dated 27.08.2022 passed by the learned Principal District and Sessions Judge-

cum-Special Judge (PC Act) (CBI), Rouse Avenue District Courts, New Delhi

inCriminal Revision No.89/2021. By the impugned judgment, the revision

preferred by the Central Bureau of Investigation (‘CBI’) was allowed and the

order dated 30.09.2020, whereby the Petitioners had been discharged, was set

aside.

2.The Petitioners also challenge the consequential order dated

22.11.2022 passed by the learned Chief Metropolitan Magistrate, Rouse

Avenue District Courts, New Delhi, whereby charges were framed against

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them for offences under Section 120B read with Sections 420, 467, 468 and

471 of the Indian Penal Code, 1860 (hereinafter referred to as the ‘IPC’), as

also the substantive offences thereunder.

FACTUAL MATRIX

3.The proceedings emanate from RC SIG 1998 E-0001 registered by the

CBI on 10.08.1998 under Section 120B IPC read with Sections 420, 467, 468,

471 and 477A IPC and the substantive offences thereunder. The accused

included late Mr. J.K. Singh, Chairman of M/s Mideast Integrated Steels Ltd.

(‘MISL’), Petitioner No. 1, who was its Managing Director, Petitioner No. 2,

who was its director, and other officers of MISL. Upon completion of

investigation, a chargesheet was filed on 14.07.2000.

4.The prosecution case, insofar as relevant to the present petition,

concerns lease finance sought by MISL from M/s Ashok Leyland Finance

Ltd. (‘ALFL’) to the tune of approximately Rs. 2 crores. According to the

CBI, the finance was obtained by representing that MISL had acquired ‘Air

Pre-heaters’ from M/s Kesoram Refractories.

5.The CBI alleges that documents relating to earlier transactions between

MISL and Kesoram Refractories for refractory material were altered and used

to support the lease finance transaction. The documents alleged to have been

forged/fabricated include a proforma invoice dated 12.09.1995, a receipt

dated 18.12.1995 which was allegedly altered to bear the date 31.01.1996, and

a bill dated 27.03.1996.

6.On the strength of the documents submitted to it, ALFL sanctioned

lease finance of Rs.1,90,18,501/-. After adjustment of the stated advance

amount, a cheque dated 29.03.1996 for Rs. 1,68,41,547/- was issued in favour

of Kesoram Refractories.

CRL.M.C. 589/2023 Page 3 of 18

7.The prosecution further alleges that the aforesaid cheque was not

credited to Kesoram Refractories at Calcutta. Instead, it was deposited in

Current Account No. 2645 opened with Vijaya Bank, Defence Colony, New

Delhi in the name of ‘Kesoram Refractories’, with co-accused Deepak Singh

shown as its proprietor. The CBI alleges that this was a fictitious concern and

that the account had been opened for encashment of the cheque issued by

ALFL.

8.According to the CBI, after encashment of the cheque, substantial

amounts were transferred to various companies of the MESCO group,

including companies stated to be under the control of late Mr. J.K. Singh and

the present Petitioners. Certain amounts are also alleged to have been

withdrawn in cash.

9.The prosecution relies upon the statement of Mr. Pinaki Mukherjee of

Kesoram Refractories to contend that Kesoram Refractories did not

manufacture or deal in ‘Air Pre-heaters’ and had not issued the documents

relied upon for supply of any such equipment. Insofar as the present

Petitioners are concerned, reliance is also placed upon the statements of Mr.

Sanjay Gandhi of ALFL, who referred to discussions with them in relation to

the proposed lease finance facility.

10.At the stage of consideration of charge, the learned CMM, by order

dated 30.09.2020, discharged the present Petitioners and one other accused.

The learned CMM,inter alia, noticed that none of the documents alleged to

have been forged bore the signatures of the Petitioners and that the material

relied upon against them consisted principally of their position in the

concerned companies, the statement regarding discussions with Mr. Sanjay

Gandhi, and the subsequent movement of funds to MESCO group entities.

CRL.M.C. 589/2023 Page 4 of 18

11.The CBI challenged the discharge order in revision. By the impugned

judgment dated 27.08.2022, the learned Revisional Court held that the

material had to be considered cumulatively and that the discharge order had

placed undue emphasis upon perceived defects in the investigation while

overlooking material bearing upon the alleged conspiracy.

12.The Revisional Court placed reliance,inter alia, upon the Petitioners’

alleged participation in the negotiations for lease finance, the use of the

disputed documents for obtaining finance, the deposit of the proceeds in the

alleged fictitious account and the subsequent transfer of funds to MESCO

group companies. The discharge order was consequently set aside and the

learned CMM was directed to frame charges against the accused.

13.Pursuant thereto, charges were framed on 22.11.2022. The Petitioners

have accordingly approached this Court seeking setting aside of the judgment

dated 27.08.2022, the consequential charges framed on 22.11.2022 and the

proceedings arising therefrom.

14.During the pendency of the present petition, the Petitioners also placed

certain Memoranda of Understanding and correspondence on record to

contend that the financial dispute between MISL and ALFL stood settled. By

order dated 17.02.2023, this Court directed the CBI to ascertain whether the

liability stood settled and the entire payment had been made.

15.In its additional status report, the CBI stated that IndusInd Bank Ltd.,

the successor entity concerned with the transaction, was approached for

verification. The Bank, however, informed the CBI by communication dated

10.11.2023 that the records pertaining to the year 2006 were not traceable and

that, owing to migration of its banking system in December, 2012, it was

unable to retrieve the account concerned. The CBI has, therefore, stated that

CRL.M.C. 589/2023 Page 5 of 18

the alleged settlement could not be independently verified from the Bank.

SUBMISSIONS ON BEHALF OF THE PETITIONERS

16.Learned Senior Counsel for the Petitioners submits that the material

collected during investigation does not disclose any specific criminal act

attributable to either Petitioner. It is contended that the prosecution seeks

substantially to derive their liability from the offices held by them in MISL

and other group companies, although criminal liability cannot be fastened

merely on account of a person being a director or person in control of a

company.

17.Learned Senior Counsel submits that the only material directly

referring to the Petitioners is the supplementary statement of Mr. Sanjay

Gandhi dated 28.04.2000, recorded approximately fifteen months after his

earlier statement dated 22.01.1999. The said statement, according to learned

Senior Counsel, merely refers to discussions with the Petitioners concerning

the lease finance proposal and neither attributes the preparation or submission

of any forged document to them nor discloses any agreement on their part to

commit an illegal act.

18.Learned Senior Counsel further submits that none of the disputed

documents bears the signature of either Petitioner and there is no allegation

that they made or altered any of the documents in question. It is also pointed

out that the originals of the proforma invoice dated 12.09.1995 and the bill

dated 27.03.1996 have not been placed on record by the CBI. Reliance is

placed uponSheila Sebastian v. R. Jawaharaj, (2018) 7 SCC 581.

19.Learned Senior Counsel next contends that the charge of criminal

conspiracy is founded upon inference rather than any material demonstrating

an agreement or meeting of minds between the Petitioners and the remaining

CRL.M.C. 589/2023 Page 6 of 18

accused. Learned Senior Counsel submits that participation in discussions

concerning a financing transaction, without anything further, cannot

constituteprima facieevidence that the Petitioners were privy to the alleged

fabrication of documents, opening of the alleged fictitious account or

diversion of funds. Reliance is placed,inter alia, uponCBI, Hyderabad v. K.

Narayana Rao, (2012) 9 SCC 512.

20.Learned Senior Counsel further submits that the Revisional Court erred

in treating the Petitioners’ status as Directors and the alleged control exercised

by them over MESCO group companies as sufficient material to proceed

against them. Learned Senior Counsel asserts that there must be material

showing an active role accompanied by the requisite criminal intent. In this

regard, reliance is placed uponSunil Bharti Mittal v. Central Bureau of

Investigation, (2015) 4 SCC 609andK. Sitaram v. CFL Capital Financial

Service Ltd., (2017) 5 SCC 725.

21.Learned Senior Counsel also questions the reliance placed upon

transfer of funds to other MESCO group entities. She submits that those

companies were not arrayed as accused and that, in its reply dated 07.02.2020

before the learned Trial Court, the CBI itself had not attributed knowledge of

the alleged forgery to the recipient companies. According to the learned

Senior Counsel, the subsequent movement of funds cannot, in these

circumstances, by itself establish their participation in the alleged conspiracy.

22.Learned Senior Counsel raises further submission in respect of Section

467 IPC. Learned Senior Counsel contends that the documents alleged to have

been forged do not answer the description of a ‘valuable security’ within

Section 30 IPC and, therefore, an offence under Section 467 IPC is not

attracted.

CRL.M.C. 589/2023 Page 7 of 18

23.Lastly, learned Senior Counsel submits that the underlying financial

dispute between MISL and ALFL stood settled long ago. The Petitioners rely

upon the Memoranda of Understanding and correspondence subsequently

placed before this Court and contend that, having regard to the settlement, the

nature of the transaction and the passage of time, continuation of the criminal

proceedings would serve no useful purpose. Reliance is placed upon the

judgments, includingGian Singh v. State of Punjab, (2012) 10 SCC 303,

CBI v. Duncans Agro Industries Ltd., (1996) 5 SCC 591andNikhil

Merchant v. Central Bureau of Investigation, (2008) 9 SCC 677.

SUBMISSIONS ON BEHALF OF THE CBI

24.Per contra, learned Special Public Prosecutor (‘SPP’) for the CBI,

supports the impugned judgment and submits that the prosecution case cannot

be tested at the stage of charge by examining each circumstance in isolation.

According to the learned SPP, the material collected during investigation,

when read as a whole, gives rise to a sufficientprima faciecase for the

Petitioners to face trial.

25.Learned SPP submits that the case against the Petitioners is not founded

merely upon their designation in MISL. The CBI relies upon the statement of

Mr. Sanjay Gandhi regarding their participation in discussions for the lease

finance facility, the allegedly fabricated documents thereafter submitted on

behalf of MISL, the sanction and disbursal of the finance, deposit of the

cheque in the alleged fictitious account and the transfer of the proceeds to

MESCO group companies stated to be under the control of the Petitioners and

late Mr. J.K. Singh.

26.Learned SPP further relies upon the statement of Mr. Pinaki Mukherjee

CRL.M.C. 589/2023 Page 8 of 18

to submit that Kesoram Refractories neither manufactured ‘Air Pre-heaters’

nor issued the documents relied upon for supply thereof. According to learned

SPP, the circumstances beginning with the negotiations for finance and

culminating in transfer of the proceeds constitute a continuous chain which

prima facie supports the charge of conspiracy.

27.Learned SPP further submits that criminal conspiracy is ordinarily

established from surrounding circumstances and conduct, and direct evidence

of the agreement between conspirators may not always be available. At the

stage of framing of charge, the Court is required only to determine whether

sufficient ground exists for proceeding against the accused and cannot

undertake a meticulous evaluation of the evidence as would be required after

trial. Reliance is placed uponState of M.P. v. S.B. Johari, (2000) 2 SCC 57,

Bhawna Bai v. Ghanshyam, Criminal Appeal No.1820/2019,andDinesh

Tiwari v. State of Uttar Pradesh, (2014) 13 SCC 137.

28.On the plea of settlement, the learned SPP submits that despite efforts

made pursuant to the order dated 17.02.2023, the alleged full and final

settlement could not be independently verified from the concerned Bank. It is

further contended that, even assuming a financial settlement, the same does

not by itself require quashing of criminal proceedings involving allegations

of conspiracy, cheating, forgery and use of forged documents.

29.In support of the latter submission, reliance is placed,inter alia, upon

State of Maharashtra v. Vikram Anantrai Doshi, (2014) 15 SCC 29,

Parbatbhai Aahir v. State of Gujarat, (2017) 9 SCC 641, Sushil Suri v. CBI,

(2011) 5 SCC 708, CBI v. Maninder Singh, (2016) 1 SCC 389 and Daya

Engineering Works (Sleeper) Ltd. v. CBI, 2019 SCC OnLine Del 10336. On

these grounds, dismissal of the petition is prayed for.

CRL.M.C. 589/2023 Page 9 of 18

FINDINGS AND ANALYSIS

30.This Court has heard the learned Senior Counsel and the learned SPP

and perused the material on record.

31.The challenge raised by the Petitioners essentially requires

consideration of four aspects: first, the effect of the judgment dated

24.12.2021 passed inCBI Case No. 32/2019; second, whether the material

collected by the CBI is sufficient, at the stage of charge, to proceed against

the Petitioners for criminal conspiracy and cheating; third, whether the

substantive charges of forgery and use of forged documents can

independently be sustained against them; and lastly, the effect of the

settlement relied upon by the Petitioners.

32.Before examining these issues, the scope of scrutiny at the stage of

framing of charge must be kept in view. At this stage, the Court is neither

expected to conduct a meticulous evaluation of the evidence nor determine

whether the prosecution would ultimately result in conviction. What is

required is the existence of material which, if taken at its face value, gives rise

to the requisite suspicion that the accused may have committed the offence

alleged. InState of Maharashtra v. Som Nath Thapa, (1996) 4 SCC 659, the

Supreme Court observed that if the Court considers that the accused “might

have committed the offence”, a charge can be framed.

33.At the same time, the jurisdiction at the stage of charge is not entirely

mechanical. The material relied upon by the prosecution must bear a

discernible connection with the offence alleged against the particular accused.

The mere fact that an accused held an office in a company or was associated

with persons against whom stronger material exists would not, by itself,

justify putting such person to trial. It is against this legal position that the

CRL.M.C. 589/2023 Page 10 of 18

material against the present Petitioners is required to be examined.

34.Considerable emphasis has been placed by the Petitioners upon the

judgment dated 24.12.2021 passed inCBI Case No. 32/2019arising out of

RC SIG/2000/E/0001, whereby they were acquitted. It is urged that the

present prosecution is barred by the principle of double jeopardy and, in any

event, by the rule of issue estoppel.

35.The contention that the present prosecution is barred altogether by

Article 20(2) of the Constitution or Section 300 CrPC cannot be accepted. The

earlier prosecution and the present prosecution arise out of separate financial

transactions. The former related to letters of credit opened in favour of

vendors of MISL and the financing arrangements connected therewith. The

present case concerns lease finance obtained from ALFL in respect of ‘Air

Pre-heaters’ allegedly supplied by Kesoram Refractories.

36.The documents which constitute the foundation of the present

prosecution are also distinct. The present case concerns,inter alia, the

proforma invoice dated 12.09.1995, the receipt dated 18.12.1995 allegedly

altered to bear the date 31.01.1996, and the bill dated 27.03.1996. The fact

that the two prosecutions involve some of the same persons, companies or

surrounding circumstances does not render the offences or the transactions

identical.

37.The protection under Section 300 CrPC is attracted when a person,

having once been tried and convicted or acquitted of an offence, is sought to

be tried again for the same offence or upon the same facts in the manner

contemplated by the provision. The present prosecution is founded upon an

alleged deception practised upon ALFL through a separate set of documents

and a separate disbursal of finance. The plea that the prosecution itself is

CRL.M.C. 589/2023 Page 11 of 18

barred by double jeopardy is, therefore, rejected.

38.The principle of issue estoppel is, however, narrower and operates

differently. It does not prohibit a subsequent trial for a distinct offence. It

precludes the prosecution from reagitating a specific fact which, between the

same parties, has already been distinctly put in issue and finally determined

by a competent court. The Constitution Bench inManipur Administration v.

Thokchom Bira Singh, AIR 1965 SC 87, explained that the rule prevents

evidence being led to prove a fact in issue which has already been determined

in favour of the accused in an earlier trial.

39.The judgment dated 24.12.2021 cannot, therefore, be read as holding

that every transaction undertaken by MISL involving Kesoram Refractories

was genuine or that no criminality could ever be alleged in relation to any

subsequent or independent transaction. The learned Special Judge was

concerned with the specific transaction forming the subject matter of that trial.

The findings recorded therein have to be understood within that setting.

40.There are, nonetheless, certain factual issues which were specifically

examined in the earlier trial and upon which findings were returned. These

include the prosecution allegations relating to the opening and operation of

Current Account No. 2645 maintained in the name of Kesoram Refractories

with Vijaya Bank, Defence Colony, the alleged movement of funds from that

account to 21st Century Finance Ltd., and the allegation concerning Kesoram

Refractories at 13/38, Kalu Sarai, New Delhi.

41.To the extent an identical factual issue was directly in question and was

conclusively determined in the earlier trial, the CBI cannot merely seek a

contrary determination of that very fact in the present proceedings while the

judgment dated 24.12.2021 continues to hold the field. The pendency of

CRL.M.C. 589/2023 Page 12 of 18

CRL.L.P. 301/2022challenging the acquittal does not, by itself, erase the

judgment. This principle, however, does not result in discharge of the

Petitioners from the present case because, as noticed above, the transaction

with ALFL and the documents forming its basis were not the subject matter

of the earlier trial.

42.The principal question is thus whether, leaving aside matters which

cannot be reopened by reason of the earlier adjudication, there remains

sufficient material against the Petitioners to justify their trial. In the opinion

of this Court, the answer, insofar as the charge of conspiracy is concerned, is

in the affirmative.

43.The learned CMM had proceeded substantially on the basis that the

Petitioners were sought to be implicated because of their status as Directors

of MISL and other group companies. There can be no quarrel with the

proposition that the IPC does not create vicarious criminal liability merely

because a person happens to be a Director or officer of a company.Sunil

Bharti Mittal (supra)makes it clear that a person acting on behalf of a

company can be made an accused where the material discloses an active role

coupled with the requisite criminal intent.

44.The present case, however, does not rest only upon the designations

held by the Petitioners. The prosecution specifically relies upon the

supplementary statement dated 28.04.2000 of PW-1 Sanjay Gandhi of ALFL.

The statement attributes to both Petitioners participation in discussions

concerning the lease-finance transaction shortly before execution of the lease

agreement.

45.According to PW-1, after his initial discussions with co-accused Rajiv

Raisinghani, further discussions were held with Petitioner No. 1 in her office

CRL.M.C. 589/2023 Page 13 of 18

and with Petitioner No. 2 in her chamber. It is also stated that during these

discussions the proposed assets were represented to have been acquired from

Kesoram Refractories, proprietor Kesoram Industries Ltd., Calcutta. The

prosecution case is that this representation was material because ALFL

proceeded on the understanding that the supplier was a concern belonging to

the Kesoram/Birla group.

46.The significance of this material cannot be examined in isolation from

what allegedly followed. According to the prosecution, the proforma invoice

and receipt purporting to emanate from Kesoram Refractories were thereafter

submitted by co-accused Rajiv Raisinghani, lease finance was sanctioned, and

PW-7 Pinaki Mukherjee stated that Kesoram Refractories neither

manufactured nor dealt in ‘Air Pre-heaters’ and had not issued documents for

supply of such equipment.

47.The submission that PW-1’s reference to the Petitioners appears only

in a supplementary statement recorded considerably after his first statement

is undoubtedly a circumstance available to the defence. It may have a bearing

upon the weight ultimately attached to his testimony. However, at the present

stage, the Court cannot discard the statement altogether or undertake the

exercise of determining whether the subsequent version is truthful. That

exercise must await trial.

48.The reliance placed uponCBI, Hyderabad (supra)also does not justify

discharge. The principle that conspiracy cannot be founded upon mere

suspicion or conjecture is unexceptionable. At the same time, conspiracy is

ordinarily proved through circumstances, since direct evidence of an

agreement to commit an unlawful act is rarely available. The question at this

stage is whether the circumstances relied upon by the prosecution, taken

CRL.M.C. 589/2023 Page 14 of 18

together, permit the matter to proceed to trial.

49.In the present case, PW-1 attributes a transaction specific role to the

Petitioners immediately preceding the grant of finance. The representation

alleged against them concerns the identity of the supplier whose documents

were subsequently used for securing the finance. At the stage of charge, this

is sufficient material to go beyond the Petitioners’ mere corporate status and

raises the requisite suspicion of their participation in the alleged conspiracy.

50.This Court is conscious that the prosecution must eventually prove that

the Petitioners knew that the representation was false and that they shared the

alleged common design. Nothing stated herein amounts to a finding on either

aspect. The limited conclusion at present is that the material is not so devoid

of substance as to justify terminating the prosecution for conspiracy at its

threshold.

51.For similar reasons, the substantive charge under Section 420 IPC

cannot be interfered with at this stage. The prosecution does not merely allege

that the Petitioners benefited from the transaction. PW-1 attributes to them a

representation concerning the supplier in the course of negotiations with

ALFL. Whether such representation was in fact made, whether it was

dishonest from inception and whether it induced ALFL to part with the funds

are matters for evidence. The ingredients alleged are, however, sufficiently

reflected in the prosecution material to permit the charge under Section 420

IPC to proceed.

52.The contention regarding non-production of the originals of certain

documents also does not justify discharge from the entire prosecution. The

manner in which the disputed documents are to be proved and the legal

consequence, if any, flowing from non-production of their originals are

CRL.M.C. 589/2023 Page 15 of 18

matters which the Trial Court will consider upon the evidence led before it.

At the stage of charge, this circumstance cannot by itself extinguish the

prosecution case.

53.The position is different when the substantive charges under Sections

467 and 468 IPC against the present Petitioners are examined. The

prosecution material does not attribute the making, signing or alteration of

any of the disputed documents to either Petitioner. The documents are also

not stated to bear their signatures.

54.InSheila Sebastian (supra), the Supreme Court considered the scheme

of Sections 463 and 464 IPC and held that a person who is not the maker of

the false document cannot be prosecuted for the offence of forgery merely

because such person may have derived benefit from it. The Court observed

that “a charge of forgery cannot be imposed on a person who is not the maker

of the same.”

55.In the present case, the chargesheet attributes the submission of the

proforma invoice and receipt to co-accused Rajiv Raisinghani. No material

has been shown to this Court which attributes the physical preparation,

alteration, execution or making of any of the disputed documents to the

Petitioners. Their alleged participation in a conspiracy to secure finance by

use of such documents stands on a different footing and is already covered by

the charge under Section 120B read with the corresponding substantive

offences.

56.The argument of the Petitioners that Section 467 IPC can have no

application because the documents do not constitute ‘valuable security’,

however, cannot be accepted in the broad manner in which it is advanced.

Section 467 IPC is not confined to a forged valuable security. Its text

CRL.M.C. 589/2023 Page 16 of 18

expressly extends,inter alia, to a document which purports to be a receipt

acknowledging payment of money. The receipt dated 18.12.1995, allegedly

altered to bear the date 31.01.1996, is stated to acknowledge receipt of

Rs.21,76,954/-. Thus, the exclusion of Section 467 IPC cannot be founded

merely upon the definition of ‘valuable security’ under Section 30 IPC.

57.The substantive charge under Sections 467 and 468 IPC against the

Petitioners nevertheless cannot survive for the separate reason that the

prosecution material does not disclose that either of them made the alleged

false documents. This would not prevent the prosecution from relying upon

the alleged forgery as an object or act of the conspiracy under Section 120B

IPC.

58.The charge under Section 471 IPC must also be examined separately.

The offence requires fraudulent or dishonest use of a forged document as

genuine, coupled with knowledge or reason to believe that the document is

forged. The material presently before the Court attributes the actual

submission of the disputed documents to co-accused Rajiv Raisinghani. No

distinct act has been identified whereby either Petitioner herself presented,

tendered or otherwise used any of those documents as genuine.

59.Their alleged participation in the larger conspiracy can, therefore,

sustain a charge under Section 120B read with Section 471 IPC, but cannot,

in the absence of material showing an act of use by them, sustain an

independent substantive charge under Section 471 IPC. To this limited extent,

interference with the charge dated 22.11.2022 is warranted.

60.The remaining submission concerns the alleged settlement of the

financial liability between MISL and ALFL. Pursuant to the order passed by

this Court, the CBI approached IndusInd Bank Ltd. for verification. The Bank

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informed the CBI that the relevant records were not traceable and that it was

unable to retrieve the account concerned after migration of its banking system.

The alleged full and final settlement could, therefore, not be independently

verified from the financial institution.

61.Even otherwise, repayment or settlement of the financial dues cannot,

by itself, conclude the present proceedings. The prosecution allegations are

not confined to non-payment of a commercial liability. The allegation is that

a financial institution was induced to disburse substantial funds on the basis

of fabricated documents pursuant to a criminal conspiracy. The criminality

alleged is, therefore, independent of the subsequent adjustment or settlement

of the monetary liability.

62.The principles laid down inGian Singh (supra)andParbatbhai Aahir

(supra)require the Court, while exercising jurisdiction under Section 482

CrPC on the basis of settlement, to consider the nature and gravity of the

offence. The decisions inVikram Anantrai Doshi (supra), Sushil Suri

(supra)andManinder Singh (supra)also make it clear that settlement of the

monetary component does not necessarily obliterate allegations involving a

pre-planned fraud or fabrication of documents.

63.In the present case, the settlement is itself incapable of independent

verification from the concerned financial institution. More importantly,

having regard to the nature of the allegations and the material noticed

hereinabove, the alleged settlement does not furnish a sufficient ground for

quashing the prosecution.

CONCLUSION

64.In view of the foregoing, the judgment dated 24.12.2021 does not bar

the present prosecution under Article 20(2) of the Constitution or Section 300

CRL.M.C. 589/2023 Page 18 of 18

CrPC, as the two proceedings arise out of distinct transactions. However, any

issue of fact directly and finally decided in the earlier trial cannot be reopened

while the said judgment remains operative, subject to the outcome of

CRL.L.P. 301/2022.

65.Even after leaving aside such issues, the statement of PW-1 Sanjay

Gandhi, read with the other material on record, is sufficient at this stage to

sustain the charge of conspiracy under Section 120B read with Sections 420,

467, 468 and 471 IPC. The substantive charge under Section 420 IPC also

calls for no interference.

66.However, there is no specific material to show that either Petitioner

herself made or altered any of the alleged forged documents, or used any such

document as genuine. Accordingly, while the charge of conspiracy shall

continue, the substantive charges under Sections 467, 468 and 471 IPC against

the Petitioners are set aside.

67.The petition is, accordingly, partly allowed to the aforesaid extent. The

learned Trial Court shall proceed in accordance with law, uninfluenced by any

observation made herein on the merits of the case.

68.The petition, along with pending application(s), if any, stands disposed

of. Interim order(s), if any, stand vacated.

[

MADHU JAIN

(JUDGE)

SEPTEMBER 24, 2026/ys/m