Rakesh Kainthla, J
1. The informant-Panna Lal Chauhan, made a complaint to the police regarding the construction of the building of GPS Moolshak Sub Tehsil Nerwa,
District Shimla, H.P. He stated that he had found gross irregularities and financial embezzlement of ₹1,70,000/- in the construction of the building.
Ample opportunities were given to deposit the amount, but the amount was not deposited; hence, it was requested that FIR be registered and the
money be recovered. The police registered FIR No.62 on 17.12.2016 for the commission of an offence punishable under Section 409 of IPC and
conducted the investigation.
2. Being aggrieved from the registration of the FIR, the petitioner filed the present petition, asserting that the matter between the parties has been
settled. The dispute between the parties is civil. The money has been paid as per the affidavit executed by Bhim Singh Thakur, and nothing is to be
recovered from the petitioner. No useful purpose would be served by continuing the proceedings; hence, it was prayed that the present petition be
allowed and the FIR No. 62 of 2016 be quashed.
3. The State opposed the petition by filing a reply making a preliminary submission regarding lack of maintainability. It was asserted that the petitioner
committed gross irregularities and financial embezzlement while constructing the school building. He withdrew ₹6,00,000/- and misappropriated
₹1,70,000/-. He refunded ₹1,70,000/- in instalments through his salary; however, a prima facie case has been made out against the petitioner. The
matter is pending in the Court of learned Judicial Magistrate, First Class, Chopal. He was liable to be proceeded departmentally for
embezzlement/misappropriation of Government money, but no action was taken against him in view of the pendency of the criminal proceedings.
4. An identical reply was filed by respondent No.2-Station House Officer.
5. I have heard Mr Susheel Gautam, learned counsel for the petitioner, Mr. Lokender Kutlehria, learned Additional Advocate General for respondents
No.1 and 2/State and Mr. Rajul Chauhan, learned counsel for respondents No.3 and 4.
6. Mr Susheel Gautam, learned counsel for the petitioner, submitted that the petitioner had deposited the amount stated to have been embezzled by
him. The dispute between the parties was civil in nature, and no fruitful purpose would be served by continuing the proceeding; therefore, he prayed
that the present petition be allowed and the FIR be ordered to be quashed.
7. Mr Lokender Kutlehria, learned Additional Advocate General for respondents No.1 and 2/State, submitted that mere deposit of the amount will not
wipe out the crime. The petitioner was entrusted with ₹6,00,000/- out of which he misappropriated ₹1,70,000/-. The offence is serious and affects the
society; therefore, he prayed that the present petition be dismissed.
8. Mr. Rajul Chauhan, learned counsel for respondents No.3 and 4, adopted the submissions of Mr. Susheel Gautam, learned counsel for the
petitioner.
9. I have given considerable thought to the submissions made at the bar and have gone through the records carefully.
10. The law regarding the exercise of jurisdiction under Section 482 of Cr.P.C. was considered by the Hon’ble Supreme Court inA .M. Mohan v.
State [2024] 3 S.C.R. 722: 2024 INSC 233:2024 SCC OnLine SC 339, wherein it was observed: -
9. The law with regard to the exercise of jurisdiction under Section 482 of Cr. P.C. to quash complaints and criminal proceedings has been succinctly summarised by
this Court in the case of Indian Oil Corporation v. NEPC India Limited (2006) 6 SCC 736: 2006 INSC 452 after considering the earlier precedents. It will be
apposite to refer to the following observations of this Court in the said case, which read thus:
“12. The principles relating to the exercise of jurisdiction under Section 482 of the Code of Criminal Procedure to quash complaints and criminal proceedings have
been stated and reiterated by this Court in several decisions. To mention a fewâ€" Madhavrao Jiwajirao Scindia v. Sambhajirao Chandrojirao Angre [(1988) 1
SCC 692: 1988 SCC (Cri) 234], State of Haryana v. Bhajan Lal [1992 Supp (1) SCC 335: 1992 SCC (Cri) 426], Rupan Deol Bajaj v. Kanwar Pal Singh Gill
[(1995) 6 SCC 194: 1995 SCC (Cri) 1059], Central Bureau of Investigation v. Duncans Agro Industries Ltd. [(1996) 5 SCC 591: 1996 SCC (Cri) 1045], State of
Bihar v. Rajendra Agrawalla [(1996) 8 SCC 164: 1996 SCC (Cri) 628], Rajesh Bajaj v. State NCT of Delhi [(1999) 3 SCC 259: 1999 SCC (Cri) 401], Medchl
Chemicals & Pharma (P) Ltd. v. Biological E. Ltd. [(2000) 3 SCC 269: 2000 SCC (Cri) 615], Hridaya Ranjan Prasad Verma v. State of Bihar [(2000) 4 SCC 168:
2000  SCC (Cri) 786], M.  Krishnan v. Vijay Singh [(2001) 8 SCC 645: 2002 SCC (Cri) 19] and Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful
Haque [(2005) 1 SCC 122: 2005 SCC (Cri) 283]. The principles relevant to our purpose are:
(i) A complaint can be quashed where the allegations made in the complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie
constitute any offence or make out the case alleged against the accused.
For this purpose, the complaint has to be examined as a whole, but without examining the merits of the allegations. Neither a detailed inquiry nor a meticulous
analysis of the material nor an assessment of the reliability or genuineness of the allegations in the complaint is warranted while examining prayer for quashing a
complaint.
(ii) A complaint may also be quashed where it is a clear abuse of the process of the court, as when the criminal proceeding is found to have been initiated with mala
fides/malice for wreaking vengeance or to cause harm, or where the allegations are absurd and inherently improbable.
(iii) The power to quash shall not, however, be used to stifle or scuttle a legitimate prosecution. The power should be used sparingly and with abundant caution.
(iv) The complaint is not required to verbatim reproduce the legal ingredients of the offence alleged. If the necessary factual foundation is laid in the complaint,
merely on the ground that a few ingredients have not been stated in detail, the proceedings should not be quashed. Quashing of the complaint is warranted only
where the complaint is so bereft of even the basic facts which are necessary for making out the offence.
(v.) A given set of facts may make out : (a) purely a civil wrong, (b) purely a criminal offence, or (c) a civil wrong as also a criminal offence. A commercial transaction
or a contractual dispute, apart from furnishing a cause of action for seeking remedy in civil law, may also involve a criminal offence. As the nature and scope of a civil
proceeding are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy
is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal
offence or not.â€
11. Similar is the judgment in Maneesha Yadav v. State of U.P. 2024 INSC 322 2024: SCC OnLine SC 643, wherein it was held:
12. We may gainfully refer to the following observations of this Court in the case of State of Haryana v. Bhajan Lal1992 Supp (1) SCC 335:
1990 INSC 363:
“102. In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court
in a series of decisions relating to the exercise of the extraordinary power under Article 226 or the inherent powers under Section 482 of the Code which we have
extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of
the process of any court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently
channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised.
(1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety, do not prima
facie constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognisable offence, justifying an
investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any
offence and make out a case against the accused.
(4) Where the allegations in the FIR do not constitute a cognisable offence but constitute only a non-cognizable offence, no investigation is permitted by a police
officer without an order of a Magistrate as contemplated under Section 155(2) of the Code.
(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just
conclusion that there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the
institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the
grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking
vengeance on the accused and with a view to spite him due to private and personal grudge.
103. We also give a note of caution to the effect that the power of quashing a criminal proceeding should be exercised very sparingly and with circumspection and
that too, in the rarest of rare cases, that the court will not be justified in embarking upon an enquiry as to the reliability or genuineness or otherwise of the allegations
made in the FIR or the complaint and that the extraordinary or inherent powers do not confer an arbitrary jurisdiction on the court to act according to its whim or
caprice.â€
12. The present petition has to be considered as per the parameters laid down by the Hon’ble Supreme Court.
13. The petition has been filed on the premise that since the petitioner has deposited the amount, the offence no longer survives. This is incorrect. It
was laid down in Vishwa Nath v. State of J & K, (1983) 1 SCC 215: 1983 SCC (Cri) 173: 1983 SCC OnLine SC 1t5ha t mere deposit of the
embezzled amount does not absolve a person of the commission of the crime. It was observed:
“6. We do not consider it necessary to refer to any decision. The facts and circumstances of this case clearly establish that there was embezzlement of government
money by the accused, inasmuch as the accused had put to personal use the government money entrusted to him instead of depositing the same in the proper place.
The fact that the accused refunded the amount when the act of his defalcation came to be discovered does not absolve him of the offence committed by him. The
accused happened to be a public servant of the Police Department and was posted as Naib-Courty. He was entrusted with the amount seized in two cases, FIR Nos.
16 and 17. In complete violation of the directions of law, he had failed to send the amount to Sadar Courty, Udhampur and with criminal intention, he had not made
any entry of the money in Rahdari Register while he made its entry in the Malkhana Register No. 1 so that his misappropriation of the amount might not be detected
by anybody. He committed a criminal breach of trust with respect to this money over which he had complete dominion by putting the same to his use between
February 7, 1972, and August 8, 1972. The refund of the amount after detection does not absolve him of the offence.â€
14. The mere fact that the money has been deposited by the petitioner will not help him.
15. The allegations in the FIR show that the petitioner was entrusted with the construction of the building. He had misappropriated the amount
entrusted to him. Prima facie, these allegations show a commission of an offence punishable under Section 409 of IPC. Therefore, the plea that the
allegations in the FIR do not show the commission of an offence and it is only a civil dispute is not acceptable. Consequently, the judgment of K.
Bharthi Devi and Anr. Versus State of Telangana and anr, 2024 INSC 750 does not apply to the present case.
16. It was laid down by the Hon’ble Supreme Court in P.Dharamaraj v. Shanmugam (2022) 15 SCC 136: 2022 SCC OnLine SC 118 6that
an offence punishable under Section 409 of IPC cannot be compounded as it affects the public at large. It was observed at page 155:
39. Thus, it is clear that the final report implicated the ac-cused for the offences under Sections 406, 409, 420 and 506 Part I IPC. None of these offences except the one
under Section 506IPC is compoundable under sub-section (1) of Section 320CrPC. The offences under Sections 406 and 420 are compoundable under sub-section (2)
of Section 320.
40. Sub-section (9) of Section 320 makes it clear that no offence shall be compounded except as provided by the Section. Therefore, there was no way the offence
under Section 409IPC, included in the final report, could have been compounded. As a matter of fact, the High Court has recognised in the penultimate paragraph of
the impugned order that the final report includes offences which are not compoundable. However, the High Court proceeded to quash the final report, purportedly on
the basis of the guidelines issued by this Court in Parbatbhai Aahir [Par-batbhai Aahir v. State of Gujarat, (2017) 9 SCC 641 : (2018) 1 SCC (Cri) 1] and Dhruv
Gurjar [State of M.P. v. Dhruv Gurjar, (2019) 5 SCC 570 : (2019) 2 SCC (Cri) 640]. Therefore, we may now proceed to examine whether the High Court was right in
doing so.
41. In Gian Singh v. State of Punjab [Gian Singh v. State of Punjab, (2012) 10 SCC 303 : (2012) 4 SCC (Civ) 1188 : (2013) 1 SCC (Cri) 160 : (2012) 2 SCC
(L&S) 988], a three-Member Bench of this Court was concerned with a reference made by a two-Member Bench, which doubted the correctness of the decisions in
B.S. Joshi v. State of Haryana [B.S. Joshi v. State of Haryana, (2003) 4 SCC 675: 2003 SCC (Cri) 848], Nikhil Merchant v. CBI [Nikhil Merchant v. CBI, (2008) 9
SCC 677 : (2008) 3 SCC (Cri) 858] and Manoj Sharma v. State [Manoj Sharma v. State, (2008) 16 SCC 1 : (2010) 4 SCC (Cri) 145].
42. B.S. Joshi [B.S. Joshi v. State of Haryana, (2003) 4 SCC 675: 2003 SCC (Cri) 848] was a case where the dispute was a family dispute and the offences
complained of were under Sections 498-A, 323 and 406. Therefore, this Court appears to have taken a lenient view.
43. Nikhil Merchant [Nikhil Merchant v. CBI, (2008) 9 SCC 677: (2008) 3 SCC (Cri) 858] is a case where a borrower com-mitted default in repayment of the loans
taken from Andhra Bank. Apart from filing a suit for recovery of money, the Bank also filed a criminal complaint both against the officers of the company and against
the officers of the bank, not only for the offences under IPC but also for the offences under the PC Act. After the suit was compro-mised, the Managing Director of
the borrower Company sought to get discharged from the complaint. The Special Judge (CBI) rejected the application for discharge. The High Court confirmed
[Nikhil Merchant v. CBI, 2005 SCC OnLine Bom 1753] the same. But this Court reversed the decision of the High Court solely on the ground that the amount
payable to the Bank stood settled. However, it must be no-ticed that in Nikhil Merchant [Nikhil Merchant v. CBI, (2008) 9 SCC 677 : (2008) 3 SCC (Cri) 858], the
operative portion of the order of this Court merely stated that the criminal pro-ceedings were quashed against the appellant therein. There is no indication therein that
the complaints against the officers for the offences under the PC Act were also quashed.
44. Manoj Sharma [Manoj Sharma v. State, (2008) 16 SCC 1 : (2010) 4 SCC (Cri) 145] was a case where the offences com-plained of were under Sections 420, 468,
471, 34 read with Section 120-BIPC. Though this Court quashed the criminal complaint in the said case also, one of the learned Judges constituting the Bench
(Markandey Katju, J.) reserved the question regarding the power of the High Court to quash non-compoundable cases under Section 482CrPC or Article 226 of the
Constitution, on the basis of the compromise reached between the parties, to be decided by a larger Bench at an appropriate time.
45. Para 27 of the decision in Manoj Sharma [Manoj Sharma v. State, (2008) 16 SCC 1 : (2010) 4 SCC (Cri) 145] which contains the opinion of
Markandey Katju, J., reads as follows : (SCC p. 10)
“27. There can be no doubt that a case under Section 302IPC or other serious offences like those under Sec-tions 395, 307 or 304-B cannot be compounded, and hence proceedings
in those provisions cannot be quashed by the High Court in the exercise of its power under Section 482CrPC or writ jurisdiction on the basis of compromise. However, in some other
cases (like those akin to a civil nature), the proceedings can be quashed by the High Court if the parties have come to an amicable settlement even though the provisions are not
compoundable. Where a line is to be drawn will have to be decided in some later decisions of this Court, prefer-ably by a larger Bench (so as to make it more authorita-tive). Some
guidelines will have to be evolved in this connection, and the matter cannot be left at the sole un-guided discretion of Judges; otherwise, there may be conflicting decisions and judicial
anarchy. A judicial dis-cretion has to be exercised on some objective guiding principles and criteria and not on the whims and fancies of individual Judges. Discretion, after all, cannot be
the Chancellor's foot.â€
46. Therefore in Gian Singh [Gian Singh v. State of Punjab, (2012) 10 SCC 303: (2012) 4 SCC (Civ) 1188 : (2013) 1 SCC (Cri) 160 : (2012) 2 SCC (L&S) 988],
the three-Member Bench of this Court took up for consideration the question regarding the difference between the power of the court to quash a complaint/charge-
sheet and the power to compound an offence. After analysing the statutory provisions and the various decisions of this Court, this Court summarised the position in
para 61 of its decision in Gian Singh [Gian Singh v. State of Punjab, (2012) 10 SCC 303 : (2012) 4 SCC (Civ) 1188 : (2013) 1 SCC (Cri) 160 : (2012) 2 SCC
(L&S) 988], as follows : (SCC p. 343)
“61. The position that emerges from the above discus-sion can be summarised thus: the power of the High Court in quashing a criminal proceeding or FIR or com-plaint in the
exercise of its inherent jurisdiction is dis-tinct and different from the power given to a criminal court for compounding the offences under Section 320 of the Code. Inherent power is of
wide plenitude with no statutory limitation, but it has to be exercised in accord with the guideline engrafted in such power viz. (i) to se-cure the ends of justice, or (ii) to prevent abuse
of the process of any court. In what cases the power to quash the criminal proceeding or complaint or FIR may be ex-ercised where the offender and victim have settled their dispute
would depend on the facts and circumstances of each case, and no category can be prescribed. However, before exercise of such power, the High Court must have due regard to the
nature and gravity of the crime. Heinous and serious offences of mental depravity or offences like murder, rape, dacoity, etc., cannot be fit-tingly quashed even though the victim or
victim's family and the offender have settled the dispute. Such offences are not private in nature and have a serious impact on society. Similarly, any compromise between the victim
and the offender in relation to the offences under special statutes like the Prevention of Corruption Act or the offences committed by public servants while working in that capacity,
etc., cannot provide any basis for quash-ing criminal proceedings involving such offences. But the criminal cases having overwhelmingly and predom-inately civil flavour stand on a
different footing for the purposes of quashing, particularly the offences arising from commercial, financial, mercantile, civil, partner-ship or such like transactions or the offences arising
out of matrimony relating to dowry, etc. or the family dis-putes where the wrong is basically private or personal in nature and the parties have resolved their entire dispute. In this
category of cases, the High Court may quash the criminal proceedings if, in its view, because of the com-promise between the offender and the victim, the possi-bility of conviction is
remote and bleak and continuation of the criminal case would put the accused to great op-pression and prejudice and extreme injustice would be caused to him by not quashing the
criminal case despite full and complete settlement and compromise with the victim. In other words, the High Court must consider whether it would be unfair or contrary to the interest
of justice to continue with the criminal proceeding or con-tinuation of the criminal proceeding would tantamount to abuse of process of law despite settlement and com-promise
between the victim and the wrongdoer and whether to secure the ends of justice, it is appropriate that the criminal case is put to an end and if the answer to the above question(s) is in
the affirmative, the High Court shall be well within its jurisdiction to quash the criminal proceeding.â€
47. After Gian Singh [Gian Singh v. State of Punjab, (2012) 10 SCC 303 : (2012) 4 SCC (Civ) 1188 : (2013) 1 SCC (Cri) 160 : (2012) 2 SCC (L&S) 988], this
Court was concerned in Narinder Singh v. State of Punjab [Narinder Singh v. State of Punjab, (2014) 6 SCC 466 : (2014) 3 SCC (Cri) 54] with the perennial problem of
courts swinging from one extreme to the other in respect of cases involving offences under Sec-tion 307IPC. A via media was struck by this Court in the said decision
by holding that it would be open to the High Court to go into the nature of the injury sustained, the nature of the weapons used, etc. This was after holding that an
of-fence under Section 307 would fall in the category of heinous and serious offence.
48. Then came the decision in State of Maharash-tra v. Vikram Anantrai Doshi [State of Maharashtra v. Vikram Anantrai Doshi, (2014) 15 SCC 29 : (2015) 4 SCC
(Cri) 563], where this Court was concerned with an order [Vikram Anantrai Doshi v. State of Maharashtra, 2010 SCC OnLine Bom 2242] of the High Court of
Bombay quashing the criminal proceedings for the offences punishable under Sections 406, 420, 467, 468 and 471 read with Section 120-BIPC. It was a case involving
credit facilities provided by the Banks and the failure of the borrowers to repay the loan. After the debts due to the bank were assigned in favour of an asset
reconstruction company, a settlement was reached, and the borrower took a “no-dues certificateâ€. Therefore, relying upon the decisions of this Court in Madan
Mohan Ab-bot v. State of Punjab [Madan Mohan Abbot v. State of Punjab, (2008) 4 SCC 582 : (2008) 2 SCC (Cri) 464] and CBI v. A. Rav-ishankar Prasad [CBI
v. A. Ravishankar Prasad, (2009) 6 SCC 351 : (2009) 2 SCC (Cri) 1063], the High Court of Bombay quashed the proceedings on the ground that no useful pur-
pose would be served by allowing the matter to proceed for trial. It is interesting to note that Madan Mohan [Madan Mohan Abbot v. State of Punjab, (2008) 4 SCC
582: (2008) 2 SCC (Cri) 464], as seen from the last paragraph of the order, was passed in the peculiar facts of the case. But insofar as A. Ravishankar Prasad [CBI
v. A. Ravishankar Prasad, (2009) 6 SCC 351 : (2009) 2 SCC (Cri) 1063] is concerned, the High Court quashed [A. Ravishankar Prasad v. State of T.N., 2008 SCC OnLine
Mad 1434] the proceedings on the basis of a set-tlement reached between the borrowers and Indian Bank. But the decision of the High Court was overturned by a
two-Judge Bench of this Court even after taking note of B.S. Joshi [B.S. Joshi v. State of Haryana, (2003) 4 SCC 675: 2003 SCC (Cri) 848] and Nikhil Merchant
[Nikhil Merchant v. CBI, (2008) 9 SCC 677 : (2008) 3 SCC (Cri) 858]. In para 46 of its decision, this Court said in A. Ravishankar Prasad [CBI v. A. Ravishankar
Prasad, (2009) 6 SCC 351: (2009) 2 SCC (Cri) 1063] : (A. Ravishankar Prasad case [CBI v. A. Ravishankar Prasad, (2009) 6 SCC 351 : (2009) 2 SCC (Cri)
1063], SCC p. 363)
“46. Before parting with the case, we would like to ob-serve that mere repayment of a loan under a settlement cannot exempt the accused from the criminal proceed-
ing in the facts of this case.â€
49. Therefore, in Vikram Anantrai Doshi [State of Maharash-tra v. Vikram Anantrai Doshi, (2014) 15 SCC 29: (2015) 4 SCC (Cri) 563], this Court took note of
the aforesaid decisions and held in para 26 as follows : (SCC p. 42)
“26. We are in respectful agreement with the aforesaid view. Be it stated that availing of money from a nation-alised bank in the manner as alleged by the
investigating agency vividly exposits fiscal impurity and, in a way, fi-nancial fraud. The modus operandi, as narrated in the charge sheet, cannot be put in the
compartment of an individual or personal wrong. It is a social wrong, and it has an immense societal impact. It is an accepted prin-ciple of handling finance that
whenever there is manip-ulation and cleverly conceived contrivance to avail of these kinds of benefits, it cannot be regarded as a case having overwhelmingly and
predominately civil charac-ter. The ultimate victim is the collective. It creates a hazard in the financial interest of the society. The grav-ity of the offence creates a dent
in the economic spine of the nation. The cleverness which has been skillfully contrived, if the allegations are true, has a serious con-sequence. A crime of this nature,
in our view, would definitely fall in the category of offences which travel far ahead of personal or private wrong. It has the potential to usher in an economic crisis. Its
implications have their own seriousness, for it creates a concavity in the solemnity that is expected in financial transactions. It is not such a case where one can pay
the amount and ob-tain a “no dues certificate†and enjoy the benefit of quashing the criminal proceeding on the hypothesis that nothing more remains to be
done. The collective interest of which the Court is the guardian cannot be a silent or a mute spectator to allow the proceedings to be with-drawn, or for that matter,
yield to the ingenuous dex-terity of the accused persons to invoke the jurisdiction under Article 226 of the Constitution or under Section 482 of the Code and quash
the proceeding. It is not legally permissible. The Court is expected to be on guard against these kinds of adroit moves. The High Court, we humbly remind, should
have dealt with the matter keeping in mind that in these kinds of litigations, the accused, when perceives a tiny gleam of success, readily invokes the inherent
jurisdiction for quashing the crim-inal proceeding. The Court's principal duty, at that junc-ture, should be to scan the entire facts to find out the thrust of the
allegations and the crux of the settlement. It is the experience of the Judge that comes to his aid, and the said experience should be used with care, cau-tion,
circumspection and courageous prudence. As we find in the case at hand, the learned Single Judge has not taken pains to scrutinise the entire conspectus of facts in
proper perspective and quashed the criminal pro-ceeding. The said quashment neither helps to secure the ends of justice nor does it prevent the abuse of the process
of the court nor can it be also said that as there is a settlement, no evidence will come on record, and there will be a remote chance of conviction. Such a find-ing, in
our view, would be difficult to record. Be that as it may, the fact remains that the social interest would be on peril, and the prosecuting agency, in these circum-
stances, cannot be treated as an alien to the whole case. Ergo, we have no other option but to hold that the order [Vikram Anantrai Doshi v. State of Maharashtra,
2010 SCC OnLine Bom 2242] of the High Court is wholly indefensi-ble.â€
50. In Parbatbhai Aahir [Parbatbhai Aahir v. State of Gujarat, (2017) 9 SCC 641 : (2018) 1 SCC (Cri) 1], referred to by the High Court in the impugned order
[Shanmugam v. State of T.N., 2021 SCC OnLine Mad 16517], a three-member Bench of this Court again summarised the broad principles on this question in para 16.
Paras 16.6 and 16.8 to 16.10 of the deci-sion read as follows : (SCC pp. 653-54, para 16)
“16. … 16.6. In the exercise of the power under Section 482 and while dealing with a plea that the dispute has been settled, the High Court must have due regard to
the nature and gravity of the offence. Heinous and serious offences involving mental depravity or offences such as murder, rape and dacoity cannot appropriately be
quashed though the victim or the family of the victim have settled the dispute. Such offences are, truly speak-ing, not private in nature but have a serious impact
upon society. The decision to continue with the trial in such cases is founded on the overriding element of public in-terest in punishing persons for serious offences.
***
16.8. Criminal cases involving offences which arise from commercial, financial, mercantile, partnership or simi-lar transactions with an essentially civil flavour may, in
appropriate situations, fall for quashing where parties have settled the dispute.
16.9. In such a case, the High Court may quash the crim-inal proceeding if, in view of the compromise between the disputants, the possibility of a conviction is remote
and the continuation of a criminal proceeding would cause oppression and prejudice and
16.10. There is yet an exception to the principle set out in proposition 16.8. and 16.9. above. Economic offences in-volving the financial and economic well-being of
the State have implications which lie beyond the domain of a mere dispute between private disputants. The High Court would be justified in declining to quash where
the offender is involved in an activity akin to financial or economic fraud or misdemeanour. The consequences of the act complained of upon the financial or
economic system will weigh in the balance.â€
51. Thus, it is clear from the march of law that the Court has to go slow even while exercising jurisdiction under Section 482CrPC or Article 226 of the Constitution in
the matter of quashing criminal proceedings on the basis of a settlement reached between the parties when the offences are capable of having an impact not merely
on the complainant and the accused but also on others.
52. As seen from the final report filed in this case and the counter-affidavit filed by the IO, persons who have adopted corrupt practices to secure employment in the
Transport Corporation fall under two categories, namely, (i) those who paid money and got orders of appointment; and (ii) those who paid money but failed to secure
employment. If persons belonging to the 2nd category are allowed to settle their dispute by taking a refund of money, the same would affix a seal of approval on the
appointment of persons be-longing to the 1st category. Therefore, the High Court ought not to have quashed the criminal proceedings on the basis of the
compromise.
53. It is needless to point out that corruption by a public servant is an offence against the State and the society at large. The Court cannot deal with cases involving
abuse of official position and adoption of corrupt practices, like suits for specific performance, where the refund of the money paid may also satisfy the agreement
holder. There-fore, we hold that the High Court was completely in error in quashing the criminal complaint.â€
17. The allegations in the FIR show that the offence was committed against the society as the public money was misappropriated by the petitioner.
Such an offence cannot be compounded merely on the deposit of the amount.
18. Therefore, the present petition cannot be allowed, and the FIR cannot be quashed based on the grounds taken in the petition; hence, the present
petition fails, and the same is dismissed.
19. The observations made hereinabove are regarding the disposal of this petition and will have no bearing, whatsoever, on the case's merits.
