CRM-M-20226-2025 (O&M) -1- 133 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CRM-M-20226-2025 (O&M) Date of decision: 21.04.2025 Nishant Pundir ....Petitioner Versus State of U.T. Chandigarh and another ...Respondents CORAM: HON'BLE MR. JUSTICE HARPREET SINGH BRAR Present: Mr. Aman Sharma, Advocate for the petitioner. Ms. Vashundhara Dalal Anand, Addl. P.P., U.T. Chandigarh. HARPREET SINGH BRAR, J. 1. The present petition has been preferred under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (hereinafter ‘BNSS’) seeking quashing of FIR No. 80 dated 10.04.2013 registered under Sections 420, 471, 120-B IPC at Police Station Sector 3, Chandigarh and all subsequent proceedings arising therefrom. 2. Briefly, the facts, as alleged, are that the about 17 persons have been arraigned as accused in FIR(supra) for dishonestly inducing respondent No.2-complainant to invest a total sum of Rs. 1,53,70,000/- in different mutual funds and other avenues connected with Reliance Capital Limited, Reliance Mutual Funds etc. Respondent No.2 is an NRI who primarily resides in Canada, while the petitioner is a registered broker. He has also alleged that the accused prepared forged documents to make unauthorised transactions in the name of respondent No.2. He made multiple written requests to stop transactions that Neha 2025.04.29 16:39 I attest to the accuracy and integrity of this document CRM-M-20226-2025 (O&M) -2- are being carried out in his name, however, the same did not stop. Subsequently, respondent No.2 found out that his forged signatures were being used to withdraw investments, which caused him to make written requests for freezing his account. In spite of the requests, about 50-60 unauthorised transactions occurred in his name. 3. Learned counsel for the petitioner inter alia contends that a compromise has been arrived between respondent No.2 and all of the accused, except the petitioner, causing the final report to be presented against the petitioner only. In fact, in furtherance of the compromise, the recovery suit initiated by respondent No.2 has also been withdrawn. Further, it was co- accused Mohinder Pal Bhalla who was empanelled with Reliance Capital Assets Management Limited as a broker while the petitioner remained an independent broker. As such, he did not have any authority to execute, sign or generate any transaction slips. Further still, upon investigation, it was concluded that the transactions were done at the behest of one Varinder, which is also proven by the CFSL report. The FIR(supra) against said Varinder already stands quashed, on the basis of compromise, vide order dated 20.11.2014 passed in CRM-M-38200-2014. No specific role has been attributed to the petitioner that would attract the alleged offences qua him, as such continuation of criminal proceedings against him when the same stands quashed qua the main, would be an abuse of process of law. Reliance in this regard is placed on the judgment of this Court in Bhawana Nimbrayan vs. State of Punjab and another in CRM-M-42479-2023 decided on 09.01.2025. 4. Per contra learned State counsel submits that during the investigation, it was found that the petitioner in connivance with the co-accused invested the money of respondent No.2 in various mutual funds schemes, by Neha 2025.04.29 16:39 I attest to the accuracy and integrity of this document CRM-M-20226-2025 (O&M) -3- forging his signatures. In the process, he gained a brokerage of Rs. 2,13,396.87/-. However, he could not controvert the fact that respondent No.2 has settled the matter with all the accused except the petitioner. 5. Having heard learned counsel for the parties and after perusing the record of the case, it transpires that the petitioner is not an employee of the accused company, nor is he empanelled with it. The petitioner has not incurred any unlawful gain by withdrawing any amount from the account of respondent No.2, nor has he signed any documents on his behalf. Further, the allegedly forged signatures on the transaction slips belong to one Varinder, as ascertained by the CFSL Report (Annexure P-9). Moreover, accused Mohinder Pal Bhalla died on 02.01.2021 resulting in the abatement of proceedings against him. Respondent No.2 has entered into a compromise with all surviving accused, except the petitioner, vide compromise deed dated 01.04.2014 (Annexure P-2). Consequently, he has also withdrawn the civil suit for recovery of Rs. 1,08,41,302.38/- along with interest. Pertinently, the civil suit was filed against the accused company and not the petitioner. 6. Further, the sole test to ascertain whether the initiation of criminal proceedings in a cheating case is merited is to see whether a culpable intention can be attributed to the accused since the very beginning. A dishonest and fraudulent intention at the inception is an essential ingredient of the offence. Unless and until this dishonest intention, right at the beginning for the performance or the entrustment in terms of any transaction of civil nature, is present, the criminal proceedings would become unwarranted as in the present case, especially since no specific role has been attributed to the petitioner. A two Judge bench of the Hon’ble Supreme Court in Mariam Fasihuddin and Neha 2025.04.29 16:39 I attest to the accuracy and integrity of this document CRM-M-20226-2025 (O&M) -4- another vs. State by Adugodi Polcie Station and another 2024 AIR SC 801, speaking through Justice Surya Kant, opined as follows: “11. It is thus paramount that in order to attract the provisions of Section   420 IPC, the prosecution has to not only prove that the accused has cheated someone but also that by doing so, he has dishonestly induced the person who is cheated to deliver property. There are, thus, three components of this offence, i.e., (i) the deception of any person, (ii) fraudulently or dishonestly inducing that person to deliver any property to any person, and (iii) mens rea or dishonest intention of the accused at the time of making the inducement. There is no gainsaid that for the offence of cheating, fraudulent and dishonest deliver any property to any person, and dishonest intention must exist from the inception when the promise or representation was made.” (emphasis added) As far as the offence of forgery is concerned, a two Judge bench of the Hon’ble Supreme Court in Arun Bhandhari vs. State of Uttar Pradesh (2013) 2 SCC 693, speaking through Justice Dipak Misra, made the following observations: “20. In G.V. Rao v. L.H.V. Prasad and others, 2000(2) RCR (Criminal) 290: (2000)3 SCC 693this Court has held thus: "7. As mentioned above, Section 415 has two parts. While in the first part, the person must "dishonestly" or "fraudulently" induce the complainant to deliver any property; in the second part, the person should intentionally induce the complainant to do or omit to do a thing. That is to say, in the first part, inducement must be dishonest or fraudulent. In the second part, the inducement should be intentional. As observed by this Court in Jaswantrai Manilal Akhaney v. State of Bombay, AIR 1956 Supreme Court 575 a guilty intention is an essential ingredient of the offence of cheating. In order, therefore, to secure conviction of a person for the offence of cheating, "mens rea" on the part of that person, must be established. It was also observed in Mahadeo Prasad v. State of W.B., AIR 1954 Supreme Court 724 that in order to constitute the offence of cheating, the intention to deceive should be in existence at the time when the inducement was offered." (emphasis added) Neha 2025.04.29 16:39 I attest to the accuracy and integrity of this document CRM-M-20226-2025 (O&M) -5- 7. Additionally, the matter stands compromised with all the main accused, which includes employees of the erring company. In terms of the compromise deed(supra), the requisite payments have been made and the civil suit of recovery, to which the petitioner was not a party, has been withdrawn by respondent No.2. Therefore, this Court is of the considered opinion that it would be highly unjust to quash the FIR(supra) qua the main accused while the co-accused, with unspecified role, has continued to face the agony of trial for over 12 years now. In fact, recently, a Division bench of this Court in Rakesh Das vs. State of Haryana and another in CRM-M-48043-2023 decided on 12.11.2024 has proscribed partial compromise, and speaking through Justice Sureshwar Thakur, opined as follows: “15. An incisive reading of the facts set-forth thereins, whereins, all the principles (supra) become settled, but do not suggest that the said principles became erected, even when a partial compromise became arrived at amongst the concerned, and/or when no composite compromise became arrived at amongst all concerned, nor also but obviously the plenitude of jurisdiction preserved in the High Courts under Section 482 Cr.P.C., became ex-posited thereins, to be available to become well recoursed, even when the concerned make only a piecemeal compromise, inasmuch as, to the extent that some of the offenders are omitted to be mentioned in the settlement as becomes drawn, and/or even when some of the aggrieved from the offending act of the offender(s) are not included in the said made settlement. 16. 16. In consequence, if the learned Single Benches of this Court after receiving a piecemeal settlement, did proceed to record a piecemeal order of composition of offence(s), besides made orders for the quashing of the verdicts of conviction drawn against the concerned, by the learned trial Judge concerned, whereagainst thus subjudice appeal(s) become instituted before the learned Appellate Court concerned, but basing them on the judgments (supra), are so made, thus without a careful and insightful reading(s) being made, both to the facts set-forth in the verdicts (supra), and, of the guidelines (supra) erected thereons.” Neha 2025.04.29 16:39 I attest to the accuracy and integrity of this document CRM-M-20226-2025 (O&M) -6- 8. In view of the discussion above, the present petition is allowed and FIR No. 80 dated 10.04.2013 registered under Sections 420, 471, 120-B IPC at Police Station Sector 3, Chandigarh and all subsequent proceedings arising therefrom, are quashed qua the petitioner. 9. Pending miscellaneous application(s), if any shall also stand disposed of. (HARPREET SINGH BRAR) JUDGE 21.04.2025 Neha Whether speaking/reasoned : Yes/No Whether reportable : Yes/No Neha 2025.04.29 16:39 I attest to the accuracy and integrity of this document