- 1 - HC-KAR NC: 2026:KHC:19427 CRL.P No. 2162 of 2019 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 8TH DAY OF APRIL, 2026 BEFORE THE HON'BLE MR. JUSTICE R. NATARAJ CRIMINAL PETITION NO. 2162 OF 2019 (482(Cr.PC) / 528(BNSS)) BETWEEN: MOHAMMED IMRAN S/O MOHAMMED AHMED AGED ABOUT 28 YEARS, R/O NO.93, K.H.B. MAIN ROAD, 3RD CROSS, 2ND MAIN ROAD, NEAR MORE, RANKA NAGAR, R.T.NAGAR, BENGALURU-560 032. …PETITIONER (BY SRI. BHARATH KUMAR V., ADVOCATE) AND: 1. STATE OF KARNATAKA THROUGH STATION HOUSE OFFICER, J.C.NAGAR POLICE STATION REPRESENTED BY STATE PUBLIC PROSECUTOR HON'BLE HIGH COURT OF KARNATAKA BENGALURU-560 001. 2. POLICE INSPECTOR HOMICIDE AND BURGLARY SQUAD CITY CRIME BRANCH, N.T.PET, BENGALURU-560 002. …RESPONDENTS (BY SRI. RAJATH SUBRAMANYAM, HIGH COURT GOVERNMENT PLEADER FOR RESPONDENT NOS.1 AND 2) Digitally signed by HEMALATHA J Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:19427 CRL.P No. 2162 of 2019 THIS CRL.P IS FILED UNDER SECTION 482 OF THE CODE OF CRIMINAL PROCEDURE, 1973 PRAYING TO QUASH THE FIR BEARING NO.59/2017 DATED 02.04.2017 ALONG WITH INFORMATION REGISTERED BY THE RESPONDENT NO.1 J.C.NAGAR POLICE WHEREIN, THE PETITIONER HEREIN IS ARRAIGNED AS ACCUSED NO.12 FOR THE ALLEGED OFFENCES U/S.420 OF IPC AND SECTION 7 OF THE SPECIFIED BANK NOTES (CESSATION OF LIABILITIES) ACT, 2017 AND SECTION 41(D), 102 OF CRIMINAL PROCEDURE CODE, AS AGAINST THE PETITIONERS CONCERNED, (ANNEXURE VIDE ANNEXURE-A AND A1 AND ETC. THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE R. NATARAJ ORAL ORDER The petitioner has challenged the registration of an FIR in Crime No.59/2017 by the respondent No.1 for the offences punishable under Section 420 of IPC, Sections 41(D), 102 of Cr.P.C. and Section 7 of the Specified Bank Notes (Cessation of Liabilities) Act, 2017 pending on the file of the I Additional Chief Metropolitan Magistrate, Bengaluru. 2. It appears from the information which is the basis of the FIR in Crime No.59/2017 that the respondent No.2 received credible information that some persons were in - 3 - HC-KAR NC: 2026:KHC:19427 CRL.P No. 2162 of 2019 possession of demonetized currency with an intent to exchange it. Based on such information, a raid was conducted and it was found that the petitioner herein along with other accused were in possession of demonetized Rs.500/- and Rs.1,000/- currency notes whose face value was a sum of Rs.9,10,00,000/-. The demonetized notes were then seized and a case in Crime No.59/2017 was registered for the aforesaid offences. 3. Being aggrieved by the registration of the FIR, the petitioner, who is arraigned as accused No.12 has filed this petition. 4. The learned counsel for the petitioner submitted that the respondent No.2 soon after getting information, ought to have drawn a FIR and thereafter, must have taken up investigation. He contends that contrarily, it is stated that the information was received and thereafter, the respondent No.2 conducted a raid and later, the respondent No.1 registered an FIR at 01.10 a.m. on 02.04.2017. He contends that this procedure adopted by the respondent No.1 falls foul of the procedure prescribed in the judgment of the Hon'ble Apex Court in Lalitha Kumari vs. State of U.P. [2014 (2) SCC 1]. - 4 - HC-KAR NC: 2026:KHC:19427 CRL.P No. 2162 of 2019 Hence, he contends that the FIR drawn against the petitioner is vitiated. This apart, he contends that the respondent No.1 has registered an FIR for an offence punishable under Section 420 of IPC though there was no entrustment of the demonetized currency. He therefore, submits that the respondent No.1 has registered an FIR only to overcome the provisions of Section 155(2) of Cr.P.C. He contends that the only offence that was made out was an offence under Section 7 of the Specified Bank Notes (Cessation of Liabilities) Act, 2017, which can be visited with a sentence of fine and therefore, is a non-cognizable offence and hence, the respondent No.1 without following the procedure under Section 155(2) of Cr.P.C, could not have proceeded with the registration of the crime. 5. The learned High Court Government Pleader for the respondents after perusing the information furnished by the respondent No.2 submitted that the fact that the petitioner and other accused were holding demonetized currency notes whose face value was Rs.9,10,00,000/- shows that they had intent to exchange it and thereby unjustly enriched themselves. Thus, he contends that an offence under Section 420 of IPC was made out. He also contends that since an offence under Section - 5 - HC-KAR NC: 2026:KHC:19427 CRL.P No. 2162 of 2019 420 of IPC is cognizable, the procedure under Section 155(2) of Cr.P.C. need not be complied with even though the offence under Section 7 of the Specified Bank Notes (Cessation of Liabilities) Act, 2017 is non-cognizable. 6. I have considered the submissions of the learned counsel for the petitioner as well as the learned High Court Government Pleader for the respondents. 7. A perusal of the information furnished by respondent No.2 shows that the petitioner and other accused were purportedly having demonetized currency notes whose face value was a sum of Rs.9,10,00,000/-. It is alleged that the petitioner and other accused intended to exchange these currencies for valid currency notes and that the respondent No.2 conducted a raid and seized the notes. As rightly contended by the learned counsel for the petitioner, soon after the respondent No.2 came to know of information that the petitioner and other accused were in possession of demonetized notes, the least that could have been done was to enter in the Station House diary and thereafter, he must have taken steps to conduct a raid. The fact that the respondents have - 6 - HC-KAR NC: 2026:KHC:19427 CRL.P No. 2162 of 2019 conducted a raid and thereafter, registered an FIR against the petitioner and other accused goes to show that the procedure prescribed Under Section 154 of Cr.P.C. is violated. In that view of the matter, the FIR registered against the petitioner stands vitiated. In addition, as rightly contended by the learned counsel for the petitioner, the respondent No.1 could not have invoked Section 420 of IPC as there was no entrustment of the demonetized currency to anyone including the petitioner and other accused. At the most, an offence under Section 7 of the Specified Bank Notes (Cessation of Liabilities) Act, 2017 may have been committed which can be visited with a sentence of fine and therefore, is a non-cognizable offence. It thus appears that the respondent No.1 in order to overcome the requirement of Section 155(2) of Cr.P.C. has invoked Section 420 of IPC. Hence, the impugned FIR drawn against the petitioner warrants interference. 8. Accordingly, the petition is allowed. The FIR drawn against the petitioner by the respondent No.1 in Crime No.59/2017 for the offences punishable under Section 420 of IPC, Sections 41(D), 102 of Cr.P.C. and Section 7 of the Specified Bank Notes (Cessation of Liabilities) Act, 2017, - 7 - HC-KAR NC: 2026:KHC:19427 CRL.P No. 2162 of 2019 pending on the file of the I Additional Chief Metropolitan Magistrate, Bengaluru, is quashed. 9. It is made clear that the investigation against the other accused may continue and the demonetized currency shall not be released to the accused but shall be sent to the Reserve Bank of India. The accused may be entitled to the replaced currency notes subject to they filing appropriate returns before concerned Income Tax officer. Sd/- (R. NATARAJ) JUDGE PMR List No.: 1 Sl No.: 16