- 1 - HC-KAR NC: 2025:KHC:23647 CRL.P No. 10104 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2ND DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR CRIMINAL PETITION NO. 10104 OF 2024 BETWEEN: SRI. N.H. RAJU S/O M. NAGRAJU, AGED ABOUT YEARS, R/O MIG 100, 1ST FLOOR 2ND STAGE, K.H.B. COLONY, BASAVESHWARA NAGARA, NEAR PUNYA HOSPITAL, BENGALURU NORTH-560079 …PETITIONER (BY SRI. ADIT CHANDANGOUDAR, ADVOCATE) AND: 1. STATE OF KARNATAKA BY MOODABIDRE POLICE STATION, MANGALORE CITY REPTD. BY STATE PUBLIC PROSECUTOR HIGH COURT OF KARNATAKA BANGALORE-560 001. 2. PRAKASH GOVIUS S/O JOHN GOVIUS AGED ABOUT 43 YEARS, R/AT RAMBAILU HOUSE, PUCHHAMOGARU POST AND VILLAGE, MOODABIDRE TALUK, MANGALURU CITY. 3. CRIMINAL INVESTIGATION DEPARTMENT SPECIAL ENQUIRY DIVISION HAVING ITS OFFICE AT: 1, DR. A. KRISHNA RAO RD., N, AMBEDKAR VEEDHI SAMPANGI RAMA NAGAR, Digitally signed by SUMA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:23647 CRL.P No. 10104 of 2024 BENGALURU, KARNATAKA-560001 …RESPONDENTS (BY SRI. B.N.JAGDEESHA, ADDL. SPP FOR RESPONDENT NOS.1 AND 3) THIS CRL.P IS FILED UNDER SECTION 482 CR.P.C (U/S 528 BNSS) PRAYING TO QUASH THE COMPLAINT DATED 17.03.2023 AT (ANNEXURE-A), THE FIR IN CRIME NO.0041/2023 REGISTERED BY THE RESPONDENT NO.1 POLICE FOR OFFENCES PUNISHABLE UNDER AT ANNEXURE-B, THE CHARGESHEET AT ANNEXURE-C AND THE ORDER DATED 20.07.2024 WHEREIN THE LEARNED TRIAL COURT HAS TAKEN COGNIZANCE AND REGISTERED THE CASE IN C.C.NO.406/2024 AGAINST THE PETITIONER FOR OFFENCES PUNISHABLE AT ANNEXURE-D AND ALL FURTHER PROCEEDINGS IN C.C.NO.406/2024 PENDING ON THE FILE OF CIVIL JUDGE AND J.M.F.C, MOODBIDRI AS AGAINST THE PETITIONER. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR ORAL ORDER In this petition, the petitioner seeks the following reliefs: "i) Quash the Complaint dated 17.03.2023 at (Annexure-A), the FIR in Crime No.0041/2023 registered by the Respondent No.1 police for offences punishable under at Annexure B, the chargesheet at Annexure C and the order dated 20.07.2024 wherein the Learned Trial Court has taken cognisance and registered the case in C.C No.406/2024 against the Petitioner for offences punishable - 3 - HC-KAR NC: 2025:KHC:23647 CRL.P No. 10104 of 2024 at Annexure D and all further proceedings in C.C No.406/2024 pending on the file of Civil Judge and J.M.F.C, Moodbidri as against the Petitioner; ii) Further this Hon'ble Court may be pleased to grant such other reliefs as deemed fit in the interest of justice and equity." 2. Heard learned counsel for the petitioner and learned Additional State Public Prosecutor for the respondent Nos.1 and 3 and perused the material on record. 3. A perusal of the material on record will indicate that respondent No.2 - de facto complainant filed the impugned complaint on 17.03.2023 which was registered as an FIR in Crime No.41/2023 against the petitioner / accused No.1 and other persons. In pursuance of the said complaint, the Police Authorities conducted investigation and submitted a charge sheet before the learned Civil Judge and JMFC., Moodabidri (Magistrate) which is not the Special Court having jurisdiction as contemplated under Section 10 of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 (for short, 'the KPID Act') (as amended by the Karnataka Protection of Interest of Depositors in Financial Establishments (Amendment) Act, 2022. In this context, - 4 - HC-KAR NC: 2025:KHC:23647 CRL.P No. 10104 of 2024 it is necessary to extract Section 10 of the KPID Act, which reads as under: "10. Special Court.-(1) For the purposes of this Act, the Government may, with the concurrence of the Chief Justice of the High Court of Karnataka, by notification, constitute one or more Special Court consisting of a Single Judge not below the rank of a District and Sessions Judge for such area or areas or for such class or classes of cases. (2) No Court including the Court constituted under the Presidency Towns Insolvency Act, 1909 (Act 3 of 1909) and the Provincial Insolvency Act, 1920 (Act 5 of 1920) other than the Special Court shall have jurisdiction in respect of any matter to which the provisions of this Act is invoked. (3) Any pending case in any other Court in respect of which the provisions of this Act invoked, shall stand transferred to the Designated Courts from the date of notification issued under sub-section (1). (4) When trying an offence under this Act, the Special Court may also try an offence, other than an offence under this Act, with which the accused may, under the Code of Criminal Procedure, 1973 be charged at the same trial." 4. A plain reading of the aforesaid provision is sufficient to come to the conclusion that insofar as the offences punishable under the KPID Act, it is only the Special Court constituted under - 5 - HC-KAR NC: 2025:KHC:23647 CRL.P No. 10104 of 2024 the said Act and not the learned Magistrate who has jurisdiction to take cognizance of the said offences. Under these circumstances, I am of the considered opinion that the impugned proceedings in C.C No.406/2024 are illegal and would stand vitiated and the same deserve to be quashed reserving liberty in favour of the respondent Nos.1 and 3 – Police to submit the charge sheet to the competent Court and proceed further in accordance with law and the provisions of the KPID Act. 5. In the result, I pass the following: ORDER i. The petition is hereby partly allowed. ii. The impugned proceedings in C.C. No.406/2024 (arising out of Crime No.41/2023 of the respondent No.1 – Police) registered for the offences punishable under Sections 406, 409, 420 of the Indian Penal Code, 1860 and Section 9 of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004, pending on the file of the Civil Judge and JMFC., Moodabidri, insofar as the petitioner / accused No.1 is concerned, are hereby quashed. - 6 - HC-KAR NC: 2025:KHC:23647 CRL.P No. 10104 of 2024 iii. The impugned order dated 20.07.2024 passed in C.C. No.406/2024 by the Civil Judge and JMFC., Moodabidri taking cognizance of the offences punishable under Sections 406, 409, 420 of the Indian Penal Code, 1860 and Section 9 of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 as against the petitioner/accused No.1 are hereby quashed. iv. Liberty is reserved in favour of the respondent Nos.1 and 3 – Police to proceed further in accordance with law by complying the provisions contained in the KPID Act. v. The Trial Court / Civil Judge and JMFC., Moodabidri, is directed to return back the charge sheet and all papers to the prosecution immediately upon receipt of a copy of this order. vi. Liberty is also reserved in favour of the petitioner to take recourse to such other remedies as available in law. Sd/- (S.R.KRISHNA KUMAR) JUDGE SMA / List No.: 3 Sl No.: 16