Quashing of FIR and Magistrate’s Order for Investigation in a Fraud Case.


08 January 2024 FIR >> Criminal Law   |   Investigation >> Criminal Law   |   Default or Fraud >> Debt Recovery  

The present application of Nandkishor Eknath Kothawade v/s State of Maharashtra (to be served through the learned Public Prosecutor Office High Court, Bombay) & Another., seeks the quashing of an Order passed on 12th February 2014 by the Judicial Magistrate, First Class, Nashik, directing the registration of an FIR (C.R. No. 41/2014) against the applicants. The complaint filed by Respondent No.2 accused the applicants of inducing him to invest Rs. 5,00,000 in their business with promises of high profits, which were never realized. Despite multiple requests for repayment, the accused issued a dishonored cheque for Rs. 14,40,000. Following this, Respondent No.2 filed a complaint alleging cheating and fraud.

Initially, the learned Magistrate examined the complainant under Section 200 of the Cr.P.C., and did not immediately initiate an investigation, instead opting for a verification process. Later, the Magistrate directed further steps to move the matter ahead but noted that no action had been taken by the complainant. Eventually, the Magistrate ordered the police to investigate under Section 156(3) of the Cr.P.C., leading to the registration of the FIR.


 

 

The applicant’s counsel argued that once the Magistrate examined the complainant and applied his mind to the complaint, cognizance was deemed to have been taken, and further investigation under Section 156(3) was inappropriate. The Court agreed, citing Supreme Court precedents, and concluded that the Magistrate had incorrectly directed police investigation under Section 156(3) after taking cognizance of the case. The Court held that an inquiry under Section 202, not an investigation under Section 156(3), should have been ordered at this stage.

Consequently, the Court quashed both the Magistrate’s order and the FIR, allowing the application and making the rule absolute.


Section 156., Code of Criminal Procedure - 1973  

Section 200., Code of Criminal Procedure - 1973  

Code of Criminal Procedure, 1973