- 1 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9TH DAY OF JULY, 2025 BEFORE THE HON'BLE MS. JUSTICE J.M.KHAZI CRIMINAL PETITION NO. 7369 OF 2023 (482(Cr.PC) / 528(BNSS)) BETWEEN: MR. V. J. K. BAKTHAVAKCHALAM S/O LATE V. KANNAIAH NAIDU, AGE ABOUT 63 YEARS NO. 140, CHIKKANNA LAYOUT, HENNUR BANGALORE NORTH, BANGALORE-560043 …PETITIONER (BY SRI.SYED KHALEEL PASHA, ADVOCATE) AND: 1. STATE OF KARNATAKA BY R.T. NAGAR POLICE STATION REP. BY SPP HIGH COURT OF KARNATAKA BANGALORE - 01 2. SHRI.KIRAN HAKKAPAKKI S/O S.G. HACKKAPAKKI, AGE 45 YEARS, RESIDENCE NO 1310, 1ST FLOOR, GAURISHANKAR NILAYA, 15TH WARD, 2ND CROSS, KALAHASTI NAGAR, T. DASARAHALLI, BANGALORE - 560057. …RESPONDENTS (BY SRI.VENKAT SATYANARAYAN.A, HCGP FOR R1; Digitally signed by REKHA R Location: High Court of Karnataka - 2 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 SRI.KISHAN DUTT KALASKAR, ADVOCATE FOR R2) THIS CRL.P IS FILED U/S.482 CR.P.C BY THE ADVOCATE FOR THE PETITIONER PRAYING TO QUASH THE FIR AND COMPLIANT DATED 25.07.2023 IN CR.NO.242/2023 U/S.406,420,34 OF IPC AND SEC.9 OF THE KARNATAKA PROTECTION OF INTEREST DEPOSITORS IN FINANCIAL ESTABLISHMENT ACT 2004 IN THE FILE OF THE I RESPONDENT POLICE PENDING ON THE FILE OF CCH-1 CITY COURT COMPLEX, BENGALURU CITY VIDE ANNEXURE A AND B. THIS PETITION, COMING ON FOR DICTATING ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MS. JUSTICE J.M.KHAZI ORAL ORDER Petitioner who is arraigned as accused No.1 has filed this petition under Section 482 of the Code of Criminal Procedure, seeking quashing of criminal proceedings initiated against him in Cr.No.242/2023 for the offences Sections 406 & 420 r/w 34 of IPC and Section 9 of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 ('KPIDFE Act' for short), on the file of CCH-1, City Civil Court Complex, Bengaluru. - 3 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 2. For the sake of convenience, parties are referred to by their ranks before the trial Court. 3. In support of the petition, the accused No.1 contended that he is the president of Karnataka Telecom Department Employees Co-operative Society. Later its name was amended as Karnataka Post and Telegraphs Employees' Co-operative Society under Section 12(2) of the Act. He was elected as President for 5 years with effect from 27.01.2022. The Society has formed and developed layout by purchasing land at various villages. In 2011, respondent No.2 was inducted as member as per the his application dated 24.02.2011. He also submitted the application for purchase of site at Ayushmanbhava layout. Due to litigation it could not complete the work in time and also incurred additional expenses. Accordingly, members were required to pay additional sum. Therefore a communication dated 15.05.2023 was also sent to respondent No.2 to pay balance of Rs.4,92,000/-and get - 4 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 the site registered. However, respondent No.2 has failed to pay the amount and get the site registered. He went on postponing the ultimately made a demand to register the site without paying balance sale consideration. On the other hand he has filed complaint based on which case is registered. 4. The concerned police after conducting preliminary enquiry have registered the case. Instead of approaching the Registrar under Section 70 of Karnataka Co-operative Society Act, to pressurize the accused, he has filed criminal complainant. The dispute is civil in nature. The allegations made does not constitute a cognizable offence and therefore, the permission of the Magistrate was required and in the absence of the same, complaint is not maintainable and hence the petition. 5. Learned High Court Government Pleader for respondent No.1 State and learned counsel for respondent No.2/complainant would submit that during 2011, when - 5 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 complainant was contemplating to purchase a site, he came in contact with accused No.1, who offered to sell a site measuring 30 x 40 ft for Rs.6 lakhs within three years. Accordingly, he became member and in all paid Rs.4,81,000/-in installments. Towards service charge, Rs.1,34,400/- was also collected from him. However, when site was not offered, on enquiry he was informed that it will be given on seniority basis and went on postponing. 5.1 However, D.B. Enterprises, Builders and Promoters (Vardhini Housing Pvt. Ltd) and Right Horizons Financial Services Pvt. Ltd are the broker companies of the Society. Through these companies, the accused have cheated several people. When insisted, the accused also offered to pay 10% additional benefit. However, on 30.09.2022, he was issued a provisional allotment letter, but later on there was no progress and when he made enquiries, he was abused and warned not to visit the office and hence, the complaint. - 6 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 6. Based on the complaint, the concerned police have registered a case in Cr.No.242/2023 and investigation is taken up. At this stage, accused No.1 has approached this Court and secured stay. The matter requires thorough investigation to ascertain the truth and pray to reject the petition. 7. Heard arguments and perused the record. 8. It is not in dispute that accused No.1 is the President of the Karnataka Telecom Department Employees Co-operative Society, which name later changed as Karnataka Post and Telegraphs Employees Co-operative Society. The grievance of the complainant is that even though he was inducted as a member during 2011 and he applied for allotment of site and deposited the sale consideration along with service charges in a sum of Rs.1,34,400/-, but site was not allotted to him, saying that allotment would be on the basis of seniority. After lapse of so many years, now the office bearers of the Society, - 7 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 including the petitioner are demanding exorbitant payments. On the other hand it is the contention of the accused No.1 that due to several litigations with land owners and lapse of time, the Society has incurred additional expenses and as such all the members are required to pay additional amount. 9. From these facts, it is evident that the dispute is civil in nature and as per Section 70 of the Karnataka Co- operative Societies Act, 1952, the complainant is at liberty to approach the Registrar of Co-operative Societies and seek the dispute to be resolved. It appears to pressurize the office bearers of the Society, the complainant has chosen to file this complaint. Therefore, the continuation of the proceedings would amount to abuse of the process of the Court and as such they are liable to be quashed and accordingly, the following: - 8 - HC-KAR NC: 2025:KHC:25162 CRL.P No. 7369 of 2023 ORDER (i) Petition filed by the accused No.1 under Section 482 Cr.P.C is hereby allowed. (ii) The FIR and complaint dated 25.07.2023 in Cr.No.242/2023 on the file of CCH-1, City Civil Court Complex, for the offences punishable under Sections 406, 420 r/w 34 IPC and Section 9 of the Karnataka Protection of Interest Depositors in Financial Establishment Act, 2004 is hereby quashed. (iii) However, complainant is at liberty to approach the Registrar of Co-operative Society and seek the dispute to be resolved. (iv) The Registry is directed to send a copy of this order to the trial court through e-mail. Sd/- (J.M.KHAZI) JUDGE RR List No.: 1 Sl No.: 50