- 1 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF SEPTEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE SACHIN SHANKAR MAGADUM CRIMINAL PETITION NO. 8563 OF 2025 BETWEEN: STATE OF KARNATAKA NOW TRANSFER TO CID POLICE, BENGALURU REPRESENTED BY THE STATE PUBLIC PROSECUTORS OFFICE, HIGH COURT BUILDING, BENGALURU - 1. …PETITIONER (BY SRI. B.N. JAGADEESH, ADDL. SPP) AND: 1. SEVEN HILLS VIVIDODDESHA SOUHARDA COOPERATIVE LTD., REP BY PRESIDENT G. NARAYANAPPA JANANI BHAVANA, MARUTHI EXTENSION MALUR TOWN, KOLAR DIST - 563 130. 2. AGREE HILLS FARM ESTATE INDIA PRIVATE LTD., REP BY MANAGING DIRECTOR - G NARAYANAPPA NO-68, 1 FLOOR, BAGALURU ROAD HOSURU KRISHNAGIRI DIST, TAMILNADU - 635 109. 3. SEVEN HILLS REALITY INDIA PVT.LTD., REP BY MANAGING DIRECTOR - G NARAYANAPPA RAMESH BUILDING DGV ROAD IN FRONT OF THE JUNIOR COLLEGE ADARSHANAGARA MALURU Digitally signed by CHAITHRA A Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 KOLAR DIST - 563 130. 4. G. NARAYANAPPA S/O GIDDAPPA, 72 YEARS, NO. 385/1, JANANI BHAVAN, MARUTHI LAYOUT, MALUR TOWN CLUB OPPO: MALUR, KOLAR DISTRICT - 563 130. 5. B.N.PRASAD S/O NARASIMHAREDDY, AGED ABOUT 55 YEARS, NO.30, HANUMENAHALLI, VATADAHOSAHALLI POST, GOWRIBIDANUR TALUK, CHICKBALLAPURA DISTRICT. 6. E.N.DHAGE @ EKANATH DHAGE S/O NAMDEV DHAGE, AGED ABOUT 65 YEARS, MOKKAM POST, AHERI, VIJAYAPURA TALUK, VIJAYAPURA DISTRICT. 7. MADHUSUDHAN Y.R S/O L RAMEGOWDA AGED ABOUT 53 YEARS, R/AT NO.C-3, DHANAVANTRI APARTMENT, 2ND CROSS, JAYALAKSHMIPURAM, MYSURU - 570 012. 8. RAMACHANDRAPPA. G S/O GURAPPA, AGED ABOUT 75 YEARS, R/AT NO.A-41, SAMADHANAPURAM SHIFCART POST, HOUSING COLONY - 3 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 HOSUR, KRISHNAGIRI, TAMILNADU STATE - 635 126. 9. SIDDARAJU H S/O HANUMEGOWDA, AGED ABOUT 65 YEARS, R/AT TAMMADAHALLI, KANDEGALA POST, MALAVALLI TALUK, MANDYA DISTRICT. 10. PRAMILA N W/O G NARAYANPPA, 55 YEARS, NO 385, JANANI BHAVAN, MARUTHI BADAVANE, MALURU TOWN, KOLAR DIST - 563 130. 11. VIJAYALAKSHMI W/O PRASAD N, 40 YEARS, HANUMANAHALLI, GOWRIBIDANURU TALUK, CHIKKABALLAPUR DIST - 561 228. 12. V. VIJAYAKUMAR S/O VENKATESHAPPA, 46 YEARS, NO-2/152, KAKKADASAM, DENKANIKOTE TALUK, KRISHNAGIRI DISTRICT TAMILUNADU - 635 107. 13. N.NAGARAJ REDDY S/O NANJAREDDY, AGED ABOUT 70 YEARS, SIDDANAPALLI, NANDIMANGALAM POST, HOSUR TALUK, KRISHNAGIRI DISTRICT, TAMILNADU STATE. 14. ANANDA REDDY S/O RAMAREDDY AGED ABOUT 57 YEARS, - 4 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 R/AT NO.1-25B, SIDDANPALLY, KELAVARAPALLI PANCHAYATI, NANDIMANGALAM POST, KRISHNAGIRI DISTRICT, TAMILNADU STATE - 635 105. 15. NARAYANA REDDY S/O MUNISWAMI REDDY, AGED ABOUT 79 YEARS, R/AT NO. 1/103, NANDIMANGALAM, NANTIMANGALAM, HOSUR, TAMILNADU STATE - 635 105. 16. G.K KUMARASWAMY S/O KRISHNAPPA, AGED ABOUT 64 YEARS, R/AT 6/100, G.MANGALA VILLAGE, BAGALURU POST, HOSUR TALUK, KRISHNAGIRI DISTRICT, TAMILNADU STATE. …RESPONDENTS THIS CRL.P IS FILED U/S.482(FILED U/S.528 BNSS) OF CR.P.C PRAYING TO ALLOW THE PETITION BY ORDERING TO CLUB FIRs 1) CR.NO.271/2015 OF NELAMANGALA POLICE STATION 2) CR.NO.305/2015 OF MANGALURU NORTH POLICE STATION, 3) CR.NO.283/2015 OF HASSAN CITY POLICE STATION 4) CR.NO.34/2016 OF K.R.PETE POLICE STATION 5) CR.NO.90/2016 OF MALUR POLICE STATION 6) CR.NO.178/2016 OF GANDHI CHOWK P.S., 7) CR.NO.57/2016 OF NAVANAGARA P.S., 8) CR.NO.232/2016 OF SIRA P.S., 9) CR.NO.233/2016 OF SIRA P.S., 10) CR.NO.269/2016 OF MALUR P.S., 11) CR.NO.161/2016 OF KOTE P.S., 12) CR.NO.267/2016 OF MANDYA SOUTH P.S., 13) CR.NO.155/2016 OF KOLLEGALA TOWN P.S., 14) CR.NO.207/2017 KRISHNARAJA P.S., IN THE CRIME NO.4/2016 OF RAMANAGARA TOWN P.S. PERMITTING INVESTIGATION - 5 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 OFFICER TO FILE ADDITIONAL CHARGE SHEETS IN THE SAID CR.NO.4/2016 OF THE RAMANAGAR TOWN POLICE STATION RELATING TO RESPECTIVELY FIRs CLUBBED, BEFORE THE PRINCIPAL DISTRICT AND SESSIONS COURT RAMANAGARA OR SPECIAL COURT AS THE CASE MAY BE. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE SACHIN SHANKAR MAGADUM ORAL ORDER This petition is filed seeking directions at the hand of this Court to club the first information reports filed against the respondents/accused. 2. Facts leading to the case are as under: The present petition is instituted by the State seeking consolidation of various First Information Reports (“FIRs”) registered against Seven Hills Vividoddesha Souharda Co- operative Limited (hereinafter referred to as “the accused society”). It is averred in the petition that several complaints have been lodged across different districts of the State, alleging that the accused society has indulged in large-scale fraud, cheating, and misappropriation of funds, thereby defrauding numerous depositors and investors. - 6 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 Consequent upon such complaints, multiple FIRs have been registered in different police stations. It is further submitted that in respect of one of the complaints, namely Crime No.4/2016, a preliminary charge-sheet has been filed before the Court of the Additional Senior Civil Judge & JMFC, Ramanagara. The learned Magistrate, having taken cognizance of the offences alleged therein, has registered a criminal case in C.C.No.47/2016. 3. The State contends that, inasmuch as the accused society constitutes a single legal entity, and as the allegations in the several FIRs pertain to an identical pattern of fraudulent activities and wilful defaults committed against a number of depositors (about fifteen in number), the evidence to be adduced in all such matters is substantially common. In order to avoid multiplicity of proceedings, conflicting findings, and to ensure an expeditious and comprehensive investigation, it is urged that all the pending FIRs be clubbed together and treated as part of a single case. Reliance is placed on Section 9-A - 7 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 of the Karnataka Protection of Interests of Depositors in Financial Establishments (Amendment) Ordinance, 2022 (for short, “the Act”), which empowers the competent authority to consolidate complaints and proceedings where they arise out of the same transaction or series of transactions involving a financial establishment. 4. It is further submitted on behalf of the State that, although Section 9-A contemplates that the order for consolidation of FIRs shall be passed by the “prescribed officer”, as of now no such officer has been formally appointed under the provisions of the Act. In the absence of the prescribed authority, the Investigating Officer is facing serious impediments in carrying out an effective and coordinated investigation. Hence, the present petition is filed seeking appropriate directions from this Court to consolidate all the FIRs registered against the accused society into Crime No.4/2016, so that the Investigating Officer may proceed with a single, exhaustive investigation - 8 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 and thereafter lay one comprehensive charge-sheet before the jurisdictional court. 5. The learned Additional Special Public Prosecutor, supporting the prayer of the petitioner-State, has reiterated that clubbing of all the pending FIRs would subserve the ends of justice and facilitate a meaningful investigation. He has also submitted that issuance of notice to the accused at this preliminary stage may be dispensed with, as no prejudice is likely to be caused to them while the matter is still at the investigation stage. Placing emphasis on the newly inserted Section 9-A of the Act, he submits that the legislative intent underlying the amendment is to avoid a fragmented investigation and trial by enabling the authorities to consolidate multiple proceedings against the same financial establishment, wherever the allegations relate to a common course of fraudulent conduct. - 9 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 6. Upon perusal of the records and on a plain reading of Section 9-A of the Act, this Court considers it appropriate to extract the said provision, which has been set out verbatim in the petition. The provision reads as follows: "9A Cognizance of offence and power to club cases:- (1) Offence under this Act are cognizable and Nonbailable. (2) Notwithstanding anything contained in any other law for time being in force, if multiple first information reports are registered either in one Police Station or in various Police Stations of the District or Commissionerate or in various police Stations of the State against the same accused person or Financial Establishment relating to fraudulent default, then such an officer as may be prescribed may order for clubbing of subsequent registered First Information Reports into the earliest case and other to carry on common investigation. Further the common Final Report be filed under Section 176 of Code of Criminal Procedure, 1973 before the Special Court, within which jurisdiction the earliest First Information report was registered and that Special Court or any other Special Court designated for trial of such offence shall try the same." - 10 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 7. On a plain reading of Section 9-A of the Act, it is manifest that the amendment was enacted with a focused and remedial object: where multiple FIRs are registered whether at a single police station or at different police stations against the same accused person or financial establishment and arising out of substantially the same transaction or a series of transactions involving fraudulent deposits or allied acts, such subsequent registrations are required to be clubbed into the earlier registered case and the Investigating Officer is empowered to carry on a common/co-ordinated investigation. The legislative purpose, as disclosed by the amendment, is to secure a uniform and consolidated probe into offences committed by a single financial establishment so as to (i) avoid multiplicity of proceedings and the attendant risk of inconsistent findings, (ii) prevent fragmentation and possible destruction of evidence, (iii) relieve complainants and witnesses of repetitive testimony on identical facts, and (iv) ensure an effective and comprehensive - 11 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 presentation of the prosecution case for the protection of depositors’ collective interests. 8. Applying the foregoing principle to the facts of the present petition, it is evident that the case falls squarely within the mischief sought to be remedied by Section 9-A. The accused — Seven Hills Vividoddesha Souharda Co- operative Limited is a single corporate entity; multiple complaints/FIRs have been lodged across the State alleging an identical or near-identical pattern of solicitation, receipt of deposits and wilful default; many material documents, bank accounts, accounting entries and witnesses are common across the FIRs; and a preliminary charge-sheet already stands filed in Crime No.4/2016 (registered as C.C.No.47/2016) before the learned Additional Senior Civil Judge & JMFC, Ramanagara. 9. 9. In these circumstances, consolidation or clubbing of the various FIRs with Crime No.4/2016 is necessary to give effect to the legislative intent embodied in Section 9- - 12 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 A and to facilitate an effective, coordinated investigation. While Section 9-A contemplates that the order for consolidation shall be made by the ‘prescribed officer’, no such officer has, as yet, been appointed under the Act. Having regard to the salutary object of the amendment and the urgent need to avoid the prejudice that would flow from disjointed probes, this Court in exercise of its supervisory jurisdiction to secure the ends of justice considers it appropriate to issue directions for consolidation in the facts of this case. The Court is mindful that procedural consolidation at the investigation stage is wholly without prejudice to the substantive rights of the accused; it simply streamlines the process of inquiry and does not pre-determine guilt. The accused will have full opportunity to raise all legal and factual objections at the trial or at such stage as may be appropriate. 10. For the foregoing reasons, this Court is of the opinion that directions should issue. Accordingly, this Court directs as follows: - 13 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 i. All FIRs registered in respect of allegations concerning fraudulent deposits, wilful default and allied offences against Seven Hills Vividoddesha Souharda Co-operative Limited which arise out of the same or substantially similar transactions as set out in Crime No.4/2016 shall stand consolidated and clubbed with Crime No.4/2016 (registered as C.C.No.47/2016) at Ramanagara for the purposes of investigation. The police shall furnish to the Investigating Officer of Crime No.4/2016 a list of the FIRs and case records that are proposed to be consolidated. ii. The Investigating Officer in Crime No.4/2016 is directed to take custody of, and place on record, the material and case diaries of the other FIRs so consolidated and to carry out a single, coordinated investigation into all such FIRs. The Investigating Officer shall co-ordinate preservation and authentication of documents, - 14 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 collection of statements, seizure records and banking material so as to avoid duplication and loss of evidence. iii. On completion of the consolidated investigation, the Investigating Officer may file one comprehensive charge-sheet in Crime No.4/2016 (C.C.No.47/2016) placing before the competent court all material gathered pursuant to the consolidated probe. iv. In view of the investigative character of the relief granted and the absence of any demonstrable prejudice at this stage, the Court dispenses with the issuance of notice to the accused for the limited purpose of these investigatory directions; provided that nothing in this order shall prejudice the right of any accused to raise objections (including jurisdictional and other legal objections) or to seek such interim relief as may be appropriate before the competent court. - 15 - HC-KAR NC: 2025:KHC:35796 CRL.P No. 8563 of 2025 v. The directions issued herein are without prejudice to the power of the competent trial court or any other court to pass such further or different orders as may be necessary in the interest of justice, and liberty is reserved to the State and to any aggrieved party to approach this Court for modification of these directions on the production of fresh material. Sd/- (SACHIN SHANKAR MAGADUM) JUDGE HDK List No.: 1 Sl No.: 36 CT: BHK