D. P. Mohapatra, J. -
(2.)The question that arises for determination in this case is whether on the facts and circumstances emerging from the averments in the complaint petition and the materials filed with it a case for quashing the complaint filed under Section 482 of the Code of Criminal Procedure (for short 'CrPC') is made out or not.
(3.)This appeal filed by the accused persons is directed against the order dated 1-3-2000 of the High Court of Andhra Pradesh in Criminal Petition No. 3052/99 declining to grant the prayer of the appellants for quashing the proceedings in CC No. 24/99 on the file of the Court of Sub-Judge, Economic Offences at Hyderabad. The proceeding was instituted on the complaint petition filed by respondent No. 1. The appellants and the respondent No. 1 are stated to be Directors of a Company M/s. Spectrum Power Generation Limited (hereinafter referred to as "the Power Company") incorporated under the Indian Companies Act, 1956 (for short 'the Act'), having its registered office at Secundrabad, in the State of Andhra Pradesh. The respondent No. 1 filed the complaint alleging offences under Sections 60, 63, 68, 68-A read with Section 621 of the Act, against the appellants, alleging inter alia that the accused persons by making false, deceptive and misleading statements and by suppressing relevant facts induced various persons to pay them money for purchase of shares of the Power Company; raised millions of Dollars from Non-Resident Indians (NRIs); siphoned off those funds into bogus companies exclusively owned by them in off-shore companies and purchased shares of the Power Company in India in the names of bogus off-shore companies owned/controlled by them. The matter came to the notice of the complainant when some of the prospective NRI investors made correspondence with the Power Company demanding share certificates for which they had paid substantial amounts to the appellants. The off-shore companies through which the appellants purchased the shares of the Power Company in Hyderabad are - M/s. Spcctrum Technologies, USA, M/s. Spcctrum Infrastructures Ltd., Jersey, Channel Islands and M/s. Spectrum Infrastructures Ltd. at Mauritius. In this process the original investors who were promised shares in Power Company were never allotted any shares. On the other hand shares were allotted to off-shore companies which have nothing to do with the Power Companies and which are exclusively owned and controlled by the accused persons. It was specifically alleged in the complaint petition that the accused persons have in effect committed fraud on the Power Company in whose name they collected money, invested that in their own companies and those companies in turn applied and got shares at the instance of the accused persons with the result that all these overseas investors are left high and dry. These acts, it is alleged by the complainant, constitute offences under Sections 68 and 68-A of the Act. It is further alleged in the complaint petition that the appellants issued a document in the name of the Spectrum Infrastructures Ltd., Jersey, Channel Islands, styled as "Project Overview". The said company issued a letter dated 30th September, 1994 by the first accused. The relevant portions of the said "Project Overview" and the letter are extracted hereunder :
208 MEGAWATT POWER PLANT AT
KAKINADA, ANDHRA PRADESH, INDIA
The letter dated 30-9-94 reads as follows :
"Re : Private Sector Power Generation Project in Kakinada, Andhra Pradesh
I am enclosing a high level overview of the investment opportunity for the above project. Though I am introducing to you to this opportunity now, we have done extensive groundwork for this project for the last two years. Today, we have reached the point where we can now make the foreign currency investment in the project.
As you are probably aware, this is clearly the best time for investing in India's economic future. The economic liberalization towards a market economy and the focus to encourage a "for profit" private investment in infrastructural industries, such as power, has presented a unique opportunity for investors like us. We seized this opportunity and vigorously promoted and developed the fast privately held Joint Venture Power Company in India.
We have a rare groundfloor investment opportunity, which would normally be sold at a premium. However, this project is being offered to you with the same high investment returns as the promoters. For the financial security of the capital and the investment income and for tax beneficial treatment, we have formed an "offshore" entity, "Spectrum Infrastructures limited" to execute and direct our investment in the power project. This entity will be the investment vehicle through which investors will be participating in this venture."
I will be in touch with you in the next few weeks to discuss your investment commitment. Thie initial investment funds will have to be made available by October 20, 1994.
In the meantime, if you have any questions, please call 382 0056 or 3821727.