When can a criminal case alleging fraud on the State as an employer not be quashed merely because the complainant and the accused have reached a private compromise?
Coram: Justice Rajesh Bindal · Justice Sudhanshu Dhulia
Criminal Procedure — Quashing of FIR on Compromise — Offence Against the State — Fraud on Employer — Criminal Procedure — FIR quashing — Victim status of the State — Compromise cannot bar prosecution — Held: The FIR disclosed fraud on the State as employer — false attendance and medical certificates used to draw salary during unauthorised foreign travel — so the complainant was not the true victim and had no locus to compromise it privately; the High Court's quashing on that basis cannot stand, appeal allowed, quashing petition dismissed. (¶7, 8, 9)
When can a criminal case alleging fraud on the State as an employer not be quashed merely because the complainant and the accused have reached a private compromise?
Where the FIR discloses that the true victim of the fraud was the State — here, salary drawn on the strength of false attendance and medical certificates during unauthorised foreign travel — the complainant who lodged it has no locus to settle the matter privately, so a quashing order resting solely on that compromise cannot be sustained.
What did the Supreme Court do with the High Court order quashing this FIR against a veterinary doctor for defrauding her employer, the State?
The Court allowed the State's appeal, set aside the High Court's quashing order, and dismissed the respondent's petition for quashing, while clarifying that the respondent remains free to raise any defence at the appropriate stage.
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The State has filed the present appeal impugning the order1 passed by the High Court2 whereby the petition3 filed by the respondent no.1 seeking quashing of the FIR was allowed and the same was quashed on the basis of the compromise entered into between the complainant- respondent no.2 and the accused-respondent no.1.
Briefly stated, the facts available on record are that a complaint was filed by the respondent no.2 with the police alleging Ashwani Kumar 1 Dated 27.02.2019 2 High Court of Punjab and Haryana at Chandigarh 3 CRM-M-51493 of 2018 certain offences committed by the respondent no.1, on the basis of which FIR4 in question was registered. Respondent no.1 at the relevant point of time was working as veterinary doctor in Policlinic, Sonipat Animal Husbandry Department. Immediately, after registration of the FIR while the matter was still under investigation, the respondent no.1 filed a petition in the High Court seeking quashing thereof. A perusal of the impugned order passed by the High Court shows that respondent no.1- accused as well as respondent no.2-complainant submitted before the High Court that the matter in dispute has been amicably settled between the parties, hence, the FIR may be quashed on the basis of the compromise. Even though in the reply filed by the State to the quashing petition, the stand taken was that the FIR does not deserve be quashed as there are serious allegations against the respondent no.1-accused. However, still the High Court merely because the complainant had compromised the matter with the respondent no.1-accused, quashed the FIR. The aforesaid order is impugned by the State before this Court.
Learned counsel for the appellant submitted that once on the basis of a complainant, submitted to the Police, an FIR had been 4 FIR No.0116 dated 12.05.2018, Police Station Barauda, Dist. Sonipat, Haryana registered with the allegations that the respondent no.1 was involved in commission of serious offences during her service career and the matter was still under investigation, the High Court exceeded its jurisdiction in quashing the FIR, merely because the complainant-respondent no.2 had compromised the matter with the accused-respondent no.1. After the FIR was registered or even before that, it was not the complainant only who was the sufferer, rather it was an offence against the State. Allegation against the respondent no.1 was of defrauding the State, her employer. The FIR was registered as cognizable offence was found to have been committed by the respondent no.1. The stand taken by the State before the High Court was not even considered.
On the other hand, learned counsel for the respondent no.1 submitted that the respondent no.2-complainant had no locus to involve in the issue. He had filed a complaint to the police with certain allegations with regard to her service career referring to certain documents, which were not privy to him. Registration of FIR against respondent no.1 was merely to harass her, who had otherwise exposed various irregularities in the Animal Husbandry Department. Even in the departmental proceedings, the respondent no.1 has been exonerated after due enquiry. If FIR is allowed to be proceeded with, it will be nothing else but an abuse of process of law. The High Court has not committed any error in the exercise of jurisdiction to quash the FIR.
We have heard learned counsel for the parties and perused the paper book.
In the case in hand, on the basis of information received under the Right to Information Act, 2015 the respondent no.2 filed complaint to the police, on the basis of which FIR in-question was registered. The contents of the same are extracted below:
“Sir, in concern to abovementioned subject, I draw your attention that Dr. Ritu Singh Veterinary Doctor Policlinic Sonipat Animal Husbandry Department was appointed in year 2013-2014 at Nizampur Gohana. Thereafter, Dr. Ritu Singh visited foreign countries 6-7 times without the permission of department. During these visits, she had shown her presence at State Veterinary Hospital Nizampur. During this period (Foreign Trips), showing false presence, self verified and withdraw the salary from Govt. Treasury. During this period, she also presented false medical certificates and intentionally, under a scheme, she withdrew the salary from Govt. Treasury and committed loss to Govt. Treasury. It is requested to you that this complaint be fairly investigated and legal action be taken against her. Enclosed: Information received under RTI. 26 Applicant: Satish Saroha S/o Sh. Lekhi Ram Village Veyapur, Sonipat.”
6.1 Immediately after registration of FIR, respondent no.1 filed a petition before the High Court seeking quashing thereof, on the basis of the compromise with the complainant, which was allowed by the High Court.
A perusal of the contents of the FIR would show that it was not the complainant who was the victim with reference to the allegations made in the complaint to the police, to enable the High Court to exercise the power to quash the FIR on the basis of compromise. The allegations are with reference to withdrawal of salary for the period the respondent no.1 was on unauthorized foreign trips and also withdrawal of salary by producing false medical certificates5. When the FIR in-question was quashed the matter was still being investigated by the police. It was even 5 The victim was not the complainant but the State. so submitted by the State in its reply to the quashing petition in the High Court.
In the facts of the present case after setting the criminal machinery into motion, which had relevance with the fraud allegedly committed by the respondent no.1 with her employer, the complainant did not have any locus to compromise the matter with the accused when the FIR had been registered. Even the High Court had failed to consider that aspect of the matter. Even though the reply filed by the State to the quashing petition was taken on record but without even referring to the stand taken therein, merely on the basis of compromise entered into between the complainant and the accused, the FIR was quashed. The order cannot be legally sustained. The allegations against the accused are of defrauding the State. How can such a matter be settled on the basis of a “compromise” between two private individuals? The simple answer is that it cannot be done.
8.1 The argument raised by the learned counsel for the respondent no.1 that in the departmental proceedings initiated on the same ground, she has already been exonerated is merely to be noticed as this may be a defence of the accused, which was not at all the ground on the basis of which the FIR in-question was quashed, at the stage of investigation.
For the reasons mentioned above, the present appeal is allowed. The impugned order passed by the High Court is set aside. The petition filed by the respondent no.1 seeking quashing of the FIR in- question on the basis of compromise is dismissed. However, we make it clear that nothing said above will prejudice the case of the respondent no.1 for taking any defence in the proceedings against her at any appropriate stage. The limited issue considered by this Court was with reference to quashing of the FIR in-question on the basis of the compromise. ……………….……………..J. (SUDHANSHU DHULIA) ……………….……………..J. (RAJESH BINDAL) New Delhi March 22, 2024.
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