Bombay HC stays investigation under FIR against Indiabulls Housing

Says charges malafide, casts doubts on bonafide of complainant

A Division Bench of the Bombay High Court on Tuesday stayed all investigations by the Palghar police regarding a first information report against Indiabulls Housing Finance (IBHL) for allegedly siphoning off funds and for accounting irregularities. 

In its order, the court cast serious doubts on the bonafides of the complainant — Ashutosh Kamble, a shareholder of the company.

IBHL had approached the court and the petition was taken up for urgent hearing. The court noted that the Supreme Court has laid down that “interference at the stage of investigation can be justified only in exceptional cases …”

Noting the malafide intent of the complainant, the court said it is prima facie of the opinion that the complaint “appears to be malafide and deficient”.

“It is needless to observe that since we have stayed the investigation, the question of taking further action on the basis of the said FIR would not arise,” the court said.

The FIR was filed by police after Palghar’s judicial magistrate passed such an order under Section 156(3) of the Code of Criminal Procedure.

The company’s counsel told the court that the FIR was nothing but part of a long-running extortion and blackmail saga. Only this time, since blackmailers who had been running this racket from Delhi have been arrested, they chose to rope in a Maharashtra-based accomplice, and this complaint is only a copy-and-paste of earlier patently false and malicious complaints that the blackmailers have been circulating.

The counsel said Kamble had approached the company a few months back and tried to extort money, but IBHL has not succumbed to the threats and extortion attempts of the blackmailers for the last three years, and has chosen to take them on through appropriate legal proceedings. Members of the gang were arrested and have had their bail applications repeatedly rejected by courts, noting their conduct as extortionists and blackmailers in the court orders.

In this case, Kamble, the counsel said, has falsified his residential address to claim favourable jurisdiction of Wada police station in Palghar, where the company has no office or business. He purchased 500 shares of the company just 10 days before lodging the FIR, to create the subterfuge of being an aggrieved shareholder.

In its order, the court acknowledged this and said “prima facie it appears that respondent no. 2 (Kamble) has been set up to initiate criminal proceedings in the matter.”

The court was also informed that the Ministry of Corporate Affairs has already examined the books of IBHL and the loans mentioned in the allegations, and has filed a court affidavit saying the loans have either been fully repaid or are standard.