W.P.(CRL) 3120/2023 & W.P.(CRL) 3116/2024 $~85 & 86 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(CRL) 3120/2023 & CRL.M.As. 28974/2023, 8816-8817/2025, 8824/2025, 13740/2025, 19233/2025 SATISH KUMAR SETHI & ANR. .....Petitioners Through: Mr. Salman Khurshid, Senior Advocate with Mr. Mohit Chaudhary, Ms. Katyayani Vajpayee, Ms. Sommya Chaturvedi, Ms. Riddhi Goyal, Mr. Saurabh Nangia and Ms. Nimmi Babu, Advocates. versus CENTRAL BUREAU OF INVESTIGATION (CBI) & ANR. .....Respondents Through: Mr. Rajesh Kumar, SPP with Ms. Mishika Pandita and Mr. Changez Khan, Advocates for CBI. Mr. O.P. Gaggar, Advocate for Union Bank of India. + W.P.(CRL) 3116/2024 & CRL.M.A. 30110/2024 PAWAN SETHI & ORS. .....Petitioners Through: Ms. Supriya Juneja, Ms. Shreya Lamba and Mr. Ritwik Saha, Advocates. versus CENTRAL BUREAU OF INVESTIGATION & ORS. .....Respondents Through: Mr. Rajesh Kumar, SPP with Ms. Mishika Pandita and Mr. Changez Khan, Advocates for CBI. Mr. O.P. Gaggar, Advocate for Union Bank of India. CORAM: HON'BLE MR. JUSTICE SANJEEV NARULA O R D E R % 10.07.2025 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/07/2025 at 12:54:40 W.P.(CRL) 3120/2023 & W.P.(CRL) 3116/2024 1. The present petitions filed under Article 226 of the Constitution of India read with Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 20231 (Corresponding to Section 482 of the Code of Criminal Procedure, 19732) seek quashing of FIR No. RC2192023E0008 dated 5th April, 2023, registered under Sections 420, 467, 468, 471 and 120B of the Indian Penal Code, 18603 and Sections 13(1)(d) and 13(2) of the Prevention of Corruption Act, 19884 at P.S. EO-I, Delhi, and all the proceeding emanating therefrom. 2. The prayer for quashing is premised on a One-Time Settlement5 entered into between PCL Oil and Solvents Ltd. & M/s Ritzy Polymers (a partnership firm forming part of PCL group of companies) with Union Bank of India (Respondent No. 2). The terms of the said settlement have been fully complied with, and the entire OTS amount, along with interest, stands paid. In support of this, the Petitioners have placed on record a No Dues Certificate dated 29th February, 2024, issued by Union Bank of India, confirming that the loan accounts of M/s PCL Oil and Solvents Ltd. and M/s Ritzy Polymers stand settled in full and final satisfaction. A copy of the said Certificate forms part of the record. 3. In addition, the Petitioners have also executed a separate OTS with Punjab National Bank (Respondent No. 3). Pursuant thereto, a No Dues Certificate dated 7th October, 2024, has been issued to PCL Oil and Solvents Ltd., affirming that the entire settlement amount has been received as per the sanctioned terms and that no outstanding dues subsist. A copy of this 1 “BNSS” 2 “CrPC” 3 “IPC” 4 “PC Act” This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/07/2025 at 12:54:40 W.P.(CRL) 3120/2023 & W.P.(CRL) 3116/2024 Certificate has also been placed on record. Consequently, the borrowers and guarantors have been formally discharged from all liabilities towards the concerned banks. 4. The factual background, leading to the filing of the present petitions are as follows: 4.1. By a sanction letter dated 12th March, 2012, Union Bank of India renewed the cash credit facility of M/s PCL Oil and Solvents Ltd. (hereinafter “the borrower company”) to the extent of INR 27 Crores and further sanctioned Import/Inland Letters of Credit to the tune of INR 70 Crores. This arrangement was part of a consortium banking structure with the erstwhile Oriental Bank of Commerce (now Punjab National Bank), resulting in an aggregate credit exposure of INR 97 Crores. The said facilities were subsequently renewed at the same levels by the Credit Approval Committee-I of Union Bank of India vide note dated 5th May, 2020. Similarly, the erstwhile Oriental Bank of Commerce (now Punjab National Bank), vide sanction note dated 30th December, 2019, sanctioned a cash credit limit of INR 11 Crores and Import/Inland Letters of Credit of INR 27.50 Crores to the borrower company. 4.2. Thereafter, upon the borrower company’s failure to adhere to its repayment obligations and to regularize its accounts, its loan account was classified as a Non-Performing Asset (NPA) by Union Bank of India with effect from 30th December, 2020, and by the erstwhile Oriental Bank of Commerce (now Punjab National Bank) on 31st July, 2020. 4.3. Subsequently, an FIR came to be registered at the behest of the Deputy General Manager, Stressed Assets Management Branch, Union 5 “OTS” This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/07/2025 at 12:54:40 W.P.(CRL) 3120/2023 & W.P.(CRL) 3116/2024 Bank of India. The FIR alleged that the borrower company, acting through its directors and guarantors, had, in collusion with certain unidentified bank officials and private individuals, entered into a criminal conspiracy to defraud the Banks. It was specifically alleged that funds were dishonestly siphoned off, diverted, and round-tripped through various group companies and related parties, thereby causing a wrongful loss of INR 135.50 Crores to Respondent Nos. 2 and 3. The FIR further averred that the borrower company, through its directors, had engaged in acts constituting fraud, cheating, criminal breach of trust, misappropriation, and diversion of sanctioned funds. 5. Mr. Salman Khurshid, senior counsel appearing for the Petitioners in W.P.(CRL) 3120/2023, and Ms. Supriya Juneja, counsel for the Petitioners in W.P.(CRL) 3116/2024, submit that the Petitioners have amicably resolved their disputes with the Respondent Banks, culminating in OTS agreements executed with Respondent No. 2 on 29th February, 2024, and with Respondent No. 3 on 7th October, 2024. Under the terms of the settlement with Respondent No. 2, Union Bank of India agreed to settle the outstanding dues of PCL Oil and Solvents Ltd. and M/s Ritzy Polymers for an aggregate amount of INR 52 Crores, payable in accordance with the schedule set out in the OTS agreement. Similarly, under the arrangement with Respondent No. 3, Punjab National Bank consented to settle the dues of PCL Oil and Solvents Ltd. for a total sum of INR 18.08 Crores, as per the sanctioned terms. The Petitioners affirm that they have fully paid the amounts stipulated under both settlements. In acknowledgment thereof, Union Bank of India, on 29th February, 2024, and Punjab National Bank, on 7th October, 2024, issued No Dues Certificates/Settlement Letters in favour This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/07/2025 at 12:54:40 W.P.(CRL) 3120/2023 & W.P.(CRL) 3116/2024 of the Petitioners, confirming that no further liabilities subsist. 6. The Court has considered the aforementioned contentions and has carefully perused the record. The Petitioners have approached this Court seeking quashing of the impugned FIR placing reliance upon the judgment of the Supreme Court in K. Bharthi Devi and Anr. v. State of Telangana and Anr.6 wherein the Court upheld the principle that continuation of criminal proceedings in purely commercial and financial disputes, which have been fully settled, would amount to an abuse of the process of law. 7. The chargesheets have been filed and pertain exclusively to offences under Sections 420, 467, 468, 471, and 120B of the IPC. It is noteworthy that, in similar circumstances, this Court in W.P.(CRL.) 3125/2023 and W.P.(CRL.) 3126/2023, after duly considering the objections advanced by Mr. Rajesh Kumar, SPP for CBI, quashed the FIRs registered against other group companies of the Petitioners, namely Ritzy Chemicals Pvt. Ltd. and Meghaaarika Impex Pvt. Ltd. The objections now raised by the State are, in substance, identical to those already adjudicated upon and rejected by this Court in the aforementioned proceedings. Consequently, the reasoning and legal analysis adopted therein would squarely apply to the facts of the present petitions. 8. In light of the comprehensive settlements arrived at with Union Bank of India and Punjab National Bank, duly evidenced by No Dues Certificates and Settlement Letters placed on record, and having regard to the fact that the underlying commercial disputes have been fully resolved to the satisfaction of the banks concerned, this Court is of the considered view that no fruitful purpose would be served in continuing the criminal proceedings. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/07/2025 at 12:54:40 W.P.(CRL) 3120/2023 & W.P.(CRL) 3116/2024 Thus, for the reasons already discussed in W.P.(CRL.) 3125/2023 and W.P.(CRL.) 3126/2023 by orders dated 5th May, 2025, and having due regard to the legal principles enunciated therein, this Court is of the opinion that the present cases warrant the exercise of powers under Article 226 of the Constitution of India read with Section 528 of BNSS (corresponding to Section 482 of CrPC). 9. Accordingly, FIR No. RC2192023E0008, registered at P.S. EO-I, Delhi, and all the proceeding emanating therefrom are hereby quashed. Consequently, as the FIR itself has been quashed, the Look Out Circular issued against the Petitioners in connection with the impugned FIR also stand quashed. 10. The petitions stand disposed of along with pending applications. SANJEEV NARULA, J JULY 10, 2025/as 6 (2024) 10 SCC 384 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 17/07/2025 at 12:54:40