Paragraph numbers below are the court’s original numbering, recovered from the source text.
14. A similar view has been expressed by this Court again in the case of Asian Resurfacing of Road Agency Private Limited (supra). By deprecating the interlocutory orders/stay of criminal proceedings by the High Courts, it is observed by this Court that the stay should not be considered as an incentive to cause delay in the proceedings. It is further observed that order granting stay or extending it must be a speaking order and stay not to operate long. It is further observed in the said decision that delay in a criminal trial has deleterious effect on the administration of justice in which the society has a vital interest; delay in trials affects the faith in Rule of Law and efficacy of the legal system; it affects social welfare and development; mere prima facie case is not enough; party seeking stay must be put to terms and stay should not be incentive to delay; the order granting stay must show application of mind; the power to grant stay is coupled with accountability. It is further observed that wherever stay is granted, a speaking order must be passed showing that the case was of an exceptional nature.
15. As observed hereinabove, there may be some cases where the initiation of criminal proceedings may be an abuse of process of law. In such cases, and only in exceptional cases and where it is found that non interference would result into miscarriage of justice, the High Court, in exercise of its inherent powers under Section 482 Cr.P.C. and/or Article 226 of the Constitution of India, may quash the FIR/complaint/criminal proceedings and even may stay the further investigation. However, the High Court should be slow in interfering the criminal proceedings at the initial stage, i.e., quashing petition filed immediately after lodging the FIR/complaint and no sufficient time is given to the police to investigate into the allegations of the FIR/complaint, which is the statutory right/ duty of the police under the provisions of the Code of Criminal Procedure. There is no denial of the fact that power under Section 482 Cr.P.C. is very wide, but as observed by this Court in catena of decisions, referred to hereinabove, conferment of wide power requires the court to be more cautious and it casts an onerous and more diligent duty on the court. Therefore, in exceptional cases, when the High Court deems it fit, regard being had to the parameters of quashing and the self-restraint imposed by law, may pass appropriate interim orders, as thought apposite in law, however, the High Court has to give brief reasons which will reflect the application of mind by the court to the relevant facts.
16. We have come across many orders passed by the High Courts passing interim orders of stay of arrest and/or “no coercive steps to be taken against the accused” in the quashing proceedings under Section 482 Cr.P.C. and/or Article 226 of the Constitution of India with assigning M/S NEEHARIKA INFRASTRUCTURE PVT. LTD. v. STATE OF MAHARASHTRA AND OTHERS [M.R. SHAH, J.] any reasons. We have also come across number of orders passed by the High Courts, while dismissing the quashing petitions, of not to arrest the accused during the investigation or till the chargesheet/final report under Section 173 Cr.P.C is filed. As observed hereinabove, it is the statutory right and even the duty of the police to investigate into the cognizable offence and collect the evidence during the course of investigation. There may be requirement of a custodial investigation for which the accused is required to be in police custody (popularly known as remand). Therefore, passing such type of blanket interim orders without assigning reasons, of not to arrest and/or “no coercive steps” would hamper the investigation and may affect the statutory right/duty of the police to investigate the cognizable offence conferred under the provisions of the Cr.P.C. Therefore, such a blanket order is not justified at all. The order of the High Court must disclose reasons why it has passed an ad-interim direction during the pendency of the proceedings under Section 482 Cr.P.C. Such reasons, however brief must disclose an application of mind. The aforesaid is required to be considered from another angle also. Granting of such blanket order would not only adversely affect the investigation but would have far reaching implications for maintaining the Rule of Law. Where the investigation is stayed for a long time, even if the stay is ultimately vacated, the subsequent investigation may not be very fruitful for the simple reason that the evidence may no longer be available. Therefore, in case, the accused named in the FIR/complaint apprehends his arrest, he has a remedy to apply for anticipatory bail under Section 438 Cr.P.C. and on the conditions of grant of anticipatory bail under Section 438 Cr.P.C being satisfied, he may be released on anticipatory bail by the competent court. Therefore, it cannot be said that the accused is remediless. It cannot be disputed that the anticipatory bail under Section 438 Cr.P.C. can be granted on the conditions prescribed under Section 438 Cr.P.C. are satisfied. At the same time, it is to be noted that arrest is not a must whenever an FIR of a cognizable offence is lodged. Still in case a person is apprehending his arrest in connection with an FIR disclosing cognizable offence, as observed hereinabove, he has a remedy to apply for anticipatory bail under Section 438 Cr.P.C. As observed by this Court in the case of Hema Mishra v. State of Uttar Pradesh, (2014) 4 SCC 453, though the High Courts have very wide powers under Article 226, the powers under Article 226 of the Constitution of India are to be exercised to prevent miscarriage of justice and to prevent abuse of process of law by the authorities indiscriminately making pre-arrest of the accused persons. It is further observed that in entertaining such a petition under Article 226, the High Court is supposed to balance the two interests. On the one hand, the Court is to ensure that such a power under Article 226 is not to be exercised liberally so as to convert it into Section 438 Cr.P.C. proceedings. It is further observed that on the other hand whenever the High Court finds that in a given case if the protection against pre-arrest is not given, it would amount to gross miscarriage of justice and no case, at all, is made for arrest pending trial, the High Court would be free to grant the relief in the nature of anticipatory bail in exercise of its powers under Article 226 of the Constitution of India, keeping in mind that this power has to be exercised sparingly in those cases where it is absolutely warranted and justified. However, such a blanket interim order of not to arrest or “no coercive steps” cannot be passed mechanically and in a routine manner.
17. So far as the order of not to arrest and/or “no coercive steps” till the final report/chargesheet is filed and/or during the course of investigation or not to arrest till the investigation is completed, passed while dismissing the quashing petitions under Section 482 Cr.P.C. and/or under Article 226 of the Constitution of India and having opined that no case is made out to quash the FIR/complaint is concerned, the same is wholly impermissible.
18. This Court in the case of Habib Abdullah Jeelani (supra), as such, deprecated such practice/orders passed by the High Courts, directing police not to arrest, even while declining to interfere with the quashing petition in exercise of powers under Section 482 Cr.P.C. In the aforesaid case before this Court, the High Court dismissed the petition filed under Section 482 Cr.P.C. for quashing the FIR. However, while dismissing the quashing petition, the High Court directed the police not to arrest the petitioners during the pendency of the investigation. While setting aside such order, it is observed by this Court that such direction amounts to an order under Section 438 Cr.P.C., albeit without satisfaction of the conditions of the said provision and the same is legally unacceptable. In the aforesaid decision, it is specifically observed and held by this Court that “it is absolutely inconceivable and unthinkable to pass an order directing the police not to arrest till the investigation is completed while declining to interfere or expressing opinion that it is not appropriate to stay the investigation”. It is further observed that this kind of order is really inappropriate and unseemly and it has no sanction in M/S NEEHARIKA INFRASTRUCTURE PVT. LTD. v. STATE OF MAHARASHTRA AND OTHERS [M.R. SHAH, J.] law. It is further observed that the courts should oust and obstruct unscrupulous litigants from invoking the inherent jurisdiction of the Court on the drop of a hat to file an application for quashing of launching an FIR or investigation and then seek relief by an interim order. It is further observed that it is the obligation of the court to keep such unprincipled and unethical litigants at bay. In the aforesaid decision, this Court has further deprecated the orders passed by the High Courts, while dismissing the applications under Section 482 Cr.P.C. to the effect that if the petitioner-accused surrenders before the trial Magistrate, he shall be admitted to bail on such terms and conditions as deemed fit and appropriate to be imposed by the Magistrate concerned. It is observed that such orders are de hors the powers conferred under Section 438 Cr.P.C. That thereafter, this Court in paragraph 25 has observed as under: “25. Having reminded the same, presently we can only say that the types of orders like the present one, are totally unsustainable, for it is contrary to the aforesaid settled principles and judicial precedents. It is intellectual truancy to avoid the precedents and issue directions which are not in consonance with law. It is the duty of a Judge to sustain the judicial balance and not to think of an order which can cause trauma to the process of adjudication. It should be borne in mid that the culture of adjudication is stabilised when intellectual discipline is maintained and further when such discipline constantly keeps guard on the mind.”
19. We are at pains to note that despite the law laid down by this Court in the case of Habib Abdullah Jeelani (supra), deprecating such orders passed by the High Courts of not to arrest during the pendency of the investigation, even when the quashing petitions under Section 482 Cr.P.C. or Article 226 of the Constitution of India are dismissed, even thereafter also, many High Courts are passing such orders. The law declared/laid down by this Court is binding on all the High Courts and not following the law laid down by this Court would have a very serious implications in the administration of justice.
20. In the recent decision of this Court in the case of Ravuri Krishna Murthy (supra), this bench set aside the similar order passed by the Andhra Pradesh High Court of granting a blanket order of protection from arrest, even after coming to the conclusion that no case for quashing was established. The High Court while disposing of the quashing petition and while refusing to quash the criminal proceedings in exercise of powers under Section 482 Cr.P.C. directed to complete the investigation into the crime without arresting the second petitioner – A2 and file a final report, if any, in accordance with law. The High Court also further passed an order that the second petitioner – A2 to appear before the investigating agency as and when required and cooperate with the investigating agency. After considering the decision of this Court in the case of Habib Abdullah Jeelani (supra), this Court set aside the order passed by the High Court restraining the investigating officer from arresting the second accused. Thus, it has been found that despite absolute proposition of law laid down by this Court in the case of Habib Abdullah Jeelani (supra) that such a blanket order of not to arrest till the investigation is completed and the final report is filed, passed while declining to quash the criminal proceedings in exercise of powers under Section 482 Cr.P.C, as observed hereinabove, the High Courts have continued to pass such orders. Therefore, we again reiterate the law laid down by this Court in the case of Habib Abdullah Jeelani (supra) and we direct all the High Courts to scrupulously follow the law laid down by this Court in the case of Habib Abdullah Jeelani (supra) and the law laid down by this Court in the present case, which otherwise the High Courts are bound to follow. We caution the High Courts again against passing such orders of not to arrest or “no coercive steps to be taken” till the investigation is completed and the final report is filed, while not entertaining quashing petitions under Section 482 Cr.P.C. and/or Article 226 of the Constitution of India.
21. Now so far as the legality of the impugned interim order passed by the High Court directing the investigating agency/police “not to adopt any coercive steps” against the accused is concerned, for the reasons stated hereinbelow, the same is unsustainable: i) that such a blanket interim order passed by the High Court affects the powers of the investigating agency to investigate into the cognizable offences, which otherwise is a statutory right/duty of the police under the relevant provisions of the Cr.P.C.; ii) that the interim order is a cryptic order; iii) that no reasons whatsoever have been assigned by the High Court, while passing such a blanket order of “no coercive steps to be adopted” by the police; M/S NEEHARIKA INFRASTRUCTURE PVT. LTD. v. STATE OF MAHARASHTRA AND OTHERS [M.R. SHAH, J.] iv) that it is not clear what the High Court meant by passing the order of “not to adopt any coercive steps”, as it is clear from the impugned interim order that it was brought to the notice of the High Court that so far as the accused are concerned, they are already protected by the interim protection granted by the learned Sessions Court, and therefore there was no further reason and/or justification for the High Court to pass such an interim order of “no coercive steps to be adopted”. If the High Court meant by passing such an interim order of “no coercive steps” directing the investigating agency/police not to further investigate, in that case, such a blanket order without assigning any reasons whatsoever and without even permitting the investigating agency to further investigate into the allegations of the cognizable offence is otherwise unsustainable. It has affected the right of the investigating agency to investigate into the cognizable offences. While passing such a blanket order, the High Court has not indicated any reasons. 21.1 As observed and held by this Court in the case of Special Director v. Mohd. Ghulam Ghouse, (2004) 3 SCC 440 that though, while passing interim orders, it is not necessary to elaborately deal with the merits, it is certainly desirable and proper for the High Court to indicate the reasons which have weighed with it in granting such an extraordinary relief in the form of an interim protection. 21.2 In the case of Nitco Tiles Ltd. v. Gujarat Ceramic Floor Tiles Mfg. Association, (2005) 12 SCC 454, it is observed and held by this Court that when an interim order should, particularly when that order may be impugned before the higher authority/ Forum, contain reasons, however brief, in support of the grant or refusal thereof. It is further observed that in the absence of such reasons, it is virtually impossible for such higher authority/Forum to determine what persuaded the grant or refusal of relief. 21.3 In the case of Hindustan Times Limited v. Union of India, (1998) 2 SCC 242, while emphasising on giving reasons by the High Court, it is observed that necessity to provide reasons, howsoever brief, in support of the High Court’s conclusions is too obvious to be reiterated. Obligation to give reasons introduces clarity and excludes or at any rate minimises the changes of arbitrariness and the higher forum can test the correctness of those reasons. 21.4 While considering the importance of the reasons to be given during the decision-making process, in the case of Kranti Associates (P) Ltd. v. Masood Ahmed, (2010) 9 SCC 496, in paragraph 47, this Court has summarised as under: “47. Summarising the above discussion, this Court holds: (a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. (b) A quasi-judicial authority must record reasons in support of its conclusions. (c) Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well. (d) Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power. (e) Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations. (f) Reasons have virtually become as indispensable a component of a decision-making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies. (g) Reasons facilitate the process of judicial review by superior courts. (h) The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the lifeblood of judicial decision-making justifying the principle that reason is the soul of justice. (i) Judicial or even quasi-judicial opinions these days can be as different as the judges and authorities who deliver them. All M/S NEEHARIKA INFRASTRUCTURE PVT. LTD. v. STATE OF MAHARASHTRA AND OTHERS [M.R. SHAH, J.] these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants’ faith in the justice delivery system. (j) Insistence on reason is a requirement for both judicial accountability and transparency. (k) If a judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism. (l) Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or “rubber-stamp reasons” is not to be equated with a valid decision-making process. (m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision-makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor [(1987) 100 Harvard Law Review 731-37] .) (n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision-making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See Ruiz Torija v. Spain [(1994) 19 EHRR 553] EHRR, at 562 para 29 and Anya v. University of Oxford [2001 EWCA Civ 405 (CA)] , wherein the Court referred to Article 6 of the European Convention of Human Rights which requires, “adequate and intelligent reasons must be given for judicial decisions”. (o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of “due process”.” Therefore, even while passing such an interim order, in exceptional cases with caution and circumspection, the High Court has to give brief reasons why it is necessary to pass such an interim order, more particularly when the High Court is exercising the extraordinary and inherent powers under Section 482 Cr.P.C. and/or under Article 226 of the Constitution of India. Therefore, in the facts and circumstances of the case, the High Court has committed a grave error of law and also of facts in passing such an interim order of “no coercive steps to be adopted” and the same deserves to be quashed and set aside. Criminal Miscellaneous Petition No. 4961 of 2021
22. Criminal Miscellaneous Petition No. 4961 of 2021 has been preferred by respondent nos. 2 to 4 herein – original accused under Section 340 r/w Section 195 (1)(B), Cr.P.C. for initiating action against the appellant. It is alleged that the appellant has suppressed the vital documents/agreements and the facts and by suppressing the material documents/agreements and the facts has obtained an interim order dated 12.10.2020 from this Court, staying order dated 28.09.2020 passed by the High Court. Number of submissions and counter submissions have been made by the learned counsel for the respective parties. However, considering the fact that the quashing petition is yet to be considered by the High Court on merits, we do not propose to entertain the present application and enter into the merits of the allegations in the present application. However, it will sufficed to say that this Court has passed an interim order dated 12.10.2020, staying order dated 28.09.2020 passed by the High Court, by giving brief reasons and even if the documents/agreements which are alleged to have been suppressed would have been there, it would not have any bearing on the interim order passed by this Court. What is weighed while passing interim order dated 12.10.2020 is very clear from the interim order dated 12.10.2020. Therefore, we close the criminal miscellaneous petition No. 4961/2021 and consequently the same stands disposed of. Conclusions:
23. In view of the above and for the reasons stated above, our final conclusions on the principal/core issue, whether the High Court would be justified in passing an interim order of stay of investigation and/or “no coercive steps to be adopted”, during the pendency of the quashing petition under Section 482 Cr.P.C and/or under Article 226 of the Constitution of India and in what circumstances and whether the High Court would be justified in passing the order of not to arrest the accused or “no coercive steps to be adopted” during the investigation or M/S NEEHARIKA INFRASTRUCTURE PVT. LTD. v. STATE OF MAHARASHTRA AND OTHERS [M.R. SHAH, J.] till the final report/chargesheet is filed under Section 173 Cr.P.C., while dismissing/disposing of/not entertaining/not quashing the criminal proceedings/complaint/FIR in exercise of powers under Section 482 Cr.P.C. and/or under Article 226 of the Constitution of India, our final conclusions are as under: i)Police has the statutory right and duty under the relevant provisions of the Code of Criminal Procedure contained in Chapter XIV of the Code to investigate into a cognizable offence; ii) Courts would not thwart any investigation into the cognizable offences; iii) It is only in cases where no cognizable offence or offence of any kind is disclosed in the first information report that the Court will not permit an investigation to go on; iv) The power of quashing should be exercised sparingly with circumspection, as it has been observed, in the ‘rarest of rare cases (not to be confused with the formation in the context of death penalty). v) While examining an FIR/complaint, quashing of which is sought, the court cannot embark upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR/complaint; vi) Criminal proceedings ought not to be scuttled at the initial stage; vii) Quashing of a complaint/FIR should be an exception rather than an ordinary rule; viii) Ordinarily, the courts are barred from usurping the jurisdiction of the police, since the two organs of the State operate in two specific spheres of activities and one ought not to tread over the other sphere; ix) The functions of the judiciary and the police are complementary, not overlapping; x) Save in exceptional cases where non-interference would result in miscarriage of justice, the Court and the judicial process should not interfere at the stage of investigation of offences; xi) Extraordinary and inherent powers of the Court do not confer an arbitrary jurisdiction on the Court to act according to its whims or caprice; xii) The first information report is not an encyclopaedia which must disclose all facts and details relating to the offence reported. Therefore, when the investigation by the police is in progress, the court should not go into the merits of the allegations in the FIR. Police must be permitted to complete the investigation. It would be premature to pronounce the conclusion based on hazy facts that the complaint/FIR does not deserve to be investigated or that it amounts to abuse of process of law. After investigation, if the investigating officer finds that there is no substance in the application made by the complainant, the investigating officer may file an appropriate report/summary before the learned Magistrate which may be considered by the learned Magistrate in accordance with the known procedure; xiii) The power under Section 482 Cr.P.C. is very wide, but conferment of wide power requires the court to be more cautious. It casts an onerous and more diligent duty on the court; xiv) However, at the same time, the court, if it thinks fit, regard being had to the parameters of quashing and the self-restraint imposed by law, more particularly the parameters laid down by this Court in the cases of R.P. Kapur (supra) and Bhajan Lal (supra), has the jurisdiction to quash the FIR/complaint; xv) When a prayer for quashing the FIR is made by the alleged accused and the court when it exercises the power under Section 482 Cr.P.C., only has to consider whether the allegations in the FIR disclose commission of a cognizable offence or not. The court is not required to consider on merits whether or not the merits of the allegations make out a cognizable offence and the court has to permit the investigating agency/police to investigate the allegations in the FIR; M/S NEEHARIKA INFRASTRUCTURE PVT. LTD. v. STATE OF MAHARASHTRA AND OTHERS [M.R. SHAH, J.] xvi) The aforesaid parameters would be applicable and/or the aforesaid aspects are required to be considered by the High Court while passing an interim order in a quashing petition in exercise of powers under Section 482 Cr.P.C. and/or under Article 226 of the Constitution of India. However, an interim order of stay of investigation during the pendency of the quashing petition can be passed with circumspection. Such an interim order should not require to be passed routinely, casually and/or mechanically. Normally, when the investigation is in progress and the facts are hazy and the entire evidence/material is not before the High Court, the High Court should restrain itself from passing the interim order of not to arrest or “no coercive steps to be adopted” and the accused should be relegated to apply for anticipatory bail under Section 438 Cr.P.C. before the competent court. The High Court shall not and as such is not justified in passing the order of not to arrest and/or “no coercive steps” either during the investigation or till the investigation is completed and/or till the final report/chargesheet is filed under Section 173 Cr.P.C., while dismissing/disposing of the quashing petition under Section 482 Cr.P.C. and/or under Article 226 of the Constitution of India. xvii) Even in a case where the High Court is prima facie of the opinion that an exceptional case is made out for grant of interim stay of further investigation, after considering the broad parameters while exercising the powers under Section 482 Cr.P.C. and/or under Article 226 of the Constitution of India referred to hereinabove, the High Court has to give brief reasons why such an interim order is warranted and/or is required to be passed so that it can demonstrate the application of mind by the Court and the higher forum can consider what was weighed with the High Court while passing such an interim order. xviii) Whenever an interim order is passed by the High Court of “no coercive steps to be adopted” within the aforesaid parameters, the High Court must clarify what does it mean by “no coercive steps to be adopted” as the term “no coercive steps to be adopted” can be said to be too vague and/or broad which can be misunderstood and/or misapplied.
24. In view of the above and for the reasons stated above, the present appeal succeeds. The impugned interim order/direction contained in clause (d) of the impugned interim order dated 28.09.2020 by which the High Court has directed that “no coercive measures to be adopted” against the petitioners (respondent nos. 2 to 4 herein) in respect of FIR No. 367/2019 dated 19.09.2019, registered at Worli Police Station, Mumbai, Maharashtra (subsequently transferred to Economic Offence Wing, Unit IX, Mumbai, renumbered as C.R. No. 82/2019) is hereby quashed and set aside. However, it is made clear that we have not expressed anything on the merits of the case, more particularly the allegations in the FIR and the High Court to consider the quashing petition in accordance with law and on its own merits and considering the afore- stated observations made by this Court in the present judgment.
25. Having regard to the fact that despite the law laid down by this Court in the case of Habib Abdullah Jeelani (supra) and other decisions, referred to hereinabove, some High Courts have continued to pass such interim orders, we direct the Registry to forward a copy of this judgment to all the High Courts to be placed before Hon’ble the Chief Justice to circulate to all the Judges of the High Courts. Divya Pandey Appeal allowed. M/S NEEHARIKA INFRASTRUCTURE PVT. LTD. v. STATE OF MAHARASHTRA AND OTHERS [M.R. SHAH, J.]