CRL OP(MD)/19357/2026 of Kalaiyarasi Vs State Of Tamilnadu Rep By Su on 9 October 2026

ORDER

This Criminal Original Petition has been filed by the petitioners, who are arrayed as Accused Nos.1 and 2 in Crime No.45 of 2025 on the file of the first respondent police, seeking to quash the First Information Report registered against them for the offences punishable under Sections 316(1), 316(4), 316(5), 318(3) and 351(2) of the Bharatiya Nyaya Sanhita, 2023 (hereinafter referred to as "BNS"). (A) THE CASE OF THE PROSECUTION:

2. The second respondent / de facto complainant, one D.Muthunarayanan, established a company under the name and style of M/s.Orril Biomass Granules Private Limited at Thalaiyuthu Village, Palani, Dindigul District, with an investment of about Rs.12,00,00,000/- (Rupees Twelve Crores only). The company converts groundnut shells, sawdust and similar materials into small cylindrical briquettes and markets them as boiler fuel at Tiruppur, Valparai and other places. According to the de facto complainant, the company engages 15

regular employees and 15 contract workers, and deploys a tipper lorry, tractors, a bull-tractor, a JCB and a Hitachi excavator for its day-to-day operations.

3. It is stated in the FIR that the first petitioner (A1) was appointed as Commercial and Operational Manager with effect from 01.11.2022 on a monthly salary of Rs.67,615/- and was placed in charge of the entire day-to-day operations of the company. With the assistance of the second petitioner, she also maintained all the income and expenditure accounts. The second petitioner (A2) was appointed as Accountant with effect from 16.04.2025 on a monthly salary of Rs.25,000/-. One Gowtham (A3) was appointed as Machine Maintenance and Production Supervisor with effect from 25.11.2021 and was drawing a monthly salary of Rs.32,508/-.

4. The gravamen of the allegations against A1 and A2 is that they misappropriated the funds of the company in more ways than one. It is alleged that one Ganapathy Green Fuels sold briquettes to M/s.Apex Coco and Solar Energy Limited, Dharapuram, and that A1 signed the invoices of the said sale as the authorised signatory of Ganapathy Green Fuels. Apex Coco paid Ganapathy Green Fuels for the said goods, and Ganapathy Green Fuels, in turn, credited a fixed sum to the bank account of A1. It is further alleged that A1 procured bills from Ganapathy Green Fuels purporting to show that the complainant company had purchased finished briquettes from that firm, and forwarded the same to the head office, on the strength of which the complainant company paid Ganapathy Green Fuels from its account. Upon such payment being received, the three accused are stated to have collected from the said firm a sum of about Rs. 25,00,000/- in all.

5. It is further alleged that, between 05.02.2024 and 09.10.2025, the complainant company paid a total sum of Rs.14,57,815/- on various dates to one Mahendran, proprietor of "Maha Trading". When confronted, the said Mahendran is stated to have disclosed that he had prepared and sent the bills at the instance of A1 and A2, and that, after retaining the amount legitimately due to him, he paid a sum of up to Rs.9,00,000/- to A1 and Rs.1,50,000/- to A2.

6. It is also alleged that, though the tractors were in fact operated by the company's own drivers, the accused claimed and drew a sum exceeding Rs. 12,00,000/- towards the engagement of separate drivers. It is further alleged that the accused raised bills for spare parts of superior quality while fitting inferior parts in the machinery, and that A1 and A3 thereby misappropriated a sum of up to Rs.30,00,000/-.

7. It is further alleged that the complainant company hired four tipper lorries at a monthly rent of Rs.2,00,000/- per lorry, out of which a sum of Rs. 70,000/- went to A1 and a sum of Rs.5,50,000/- was paid to A2. According to the de facto complainant, within one or two days of the company making payment to Ganapathy Green Fuels for goods, the amounts found their way into the accounts of A1 and A2. In sum, it is alleged that the three accused conspired to maintain false accounts in respect of raw materials, finished goods, spare parts and the rent for the tipper lorries and tractors, and, by misappropriation, cheating and criminal breach of trust, caused a loss of about Rs.2,00,00,000/- to the complainant company. On the said complaint, the present FIR came to be registered. (B) SUBMISSIONS OF THE LEARNED COUNSEL ON EITHER SIDE:

8. The learned counsel appearing for the petitioners would submit that the complaint is false and motivated, and that the FIR came to be registered without any preliminary enquiry. According to him, the essential ingredients of the offences of criminal breach of trust and cheating are conspicuously absent. Placing reliance upon the decision of the Hon'ble Supreme Court in Delhi Race Club (1940) Ltd. and others Vs. State of Uttar Pradesh and another, reported in 2024 SCC OnLine SC 2248, he would contend that the offences of criminal breach of trust and cheating (under Sections 406 and 420 IPC) cannot co-exist in respect of the same set of facts.

9. The learned counsel for the petitioners would further contend that, even according to the FIR, the company had been running at a loss right from its inception, and that such losses were attributable only to market conditions. He would point out that Ganapathy Green Fuels belongs to one Ilango, with whom the petitioners have no connection whatsoever. Per contra, it is the case of the petitioners that the de facto complainant himself operates the bank account of the second petitioner, and that Ganapathy Green Fuels was, in reality, operated by the complainant company itself, with a view to evade tax. The learned counsel also relied upon a tabulated statement to show that the amounts credited to the accounts of A1 and A2 were, in turn, disbursed towards the supply of raw materials to the complainant company.

10. Per contra, the learned Senior Counsel appearing for the second respondent would submit that the allegations are specific, supported by invoice numbers, dates and amounts, and that the relevant documents have been annexed to the complaint. He would point out that the first petitioner's own signature appears as authorised signatory on the invoices of Ganapathy Green Fuels, the very firm from which the company, through A1, was effecting purchases. According to him, the grounds urged by the petitioners are matters of defence which can be tested only in the course of investigation.

11. In support of his contentions, the learned Senior Counsel for the second respondent placed reliance upon the following decisions of the Hon'ble Supreme Court:

(i) Rocky Vs. State of Telangana and another, 2025 SCC OnLine

SC 2713;

(ii) Priti Saraf and another Vs. State (NCT of Delhi) and another, (2021) 16 SCC 142;

(iii) Dr. Lakshman Vs. State of Karnataka and others, (2019) 9 SCC 677;

(iv) S.W.Palanitkar and others Vs. State of Bihar and another, (2002) 1 SCC 241;

(v) M.Krishnan Vs. Vijay Singh and another, (2001) 8 SCC 645;

(vi) Alpic Finance Ltd. Vs. P.Sadasivan and another, (2001) 3 SCC 513; and

(vii) Rajesh Bajaj Vs. State NCT of Delhi and others, (1999) 3 SCC 259.

12. The learned Government Advocate (Crl. Side) appearing for the first respondent police would submit that the investigation is in progress and that the materials collected so far, including the bank statements and invoices, call for detailed scrutiny. According to him, the FIR clearly discloses the commission of cognizable offences, and the grounds raised by the petitioners are matters for investigation which cannot be gone into in a petition for quashing. Hence, he would contend that the investigation ought not to be interdicted.

13. The learned Government Advocate (Crl. Side) would further submit that the conduct of a preliminary enquiry is discretionary, and is confined to offences punishable with imprisonment for three years or more but less than seven years, whereas the offences under Sections 316(4) and 316(5) of BNS fall outside that category. It is also pointed out that the FIR came to be registered on the written direction of the Superintendent of Police, after perusal of the complaint and the documents annexed thereto. Hence, according to him, the said ground is not available to the petitioners.

14. Heard the learned counsel appearing on either side and perused the materials available on record. (C) DISCUSSION:

15. A reading of the FIR as a whole, taking the allegations at their face value, discloses the following:

(a) the first petitioner occupied a position of trust, with dominion over the purchases and funds of the company; (b) the second petitioner was maintaining the accounts of the company;

(c) the funds of the company were diverted to the accounts of the petitioners by means of fictitious and inflated bills; and (d) the company was induced to make payments on the strength of invoices which are alleged to be false.

16. The above allegations, on their face, disclose the ingredients of criminal breach of trust by a servant as well as of cheating. The allegation of

death threats said to have been held out on 08.12.2025, in the presence of the named witnesses, independently discloses the offence under Section 351(2) of BNS.

17. Insofar as the decision in Delhi Race Club's case (cited supra) relied upon by the learned counsel for the petitioners is concerned, the same arose out of a single transaction of sale of goods, where the grievance was one of non- payment of the sale price. In the case on hand, however, the FIR alleges misappropriation of funds and property entrusted to the petitioners in their capacity as employees. Over and above that, there is a distinct allegation that the company was deceived by means of fabricated invoices and was thereby induced to part with money. Whether the materials ultimately collected would support the one offence or the other, or both, is a matter for the investigating agency to determine while filing the final report. In any event, the offence under Section 351(2) of BNS stands on its own footing. Hence, the said decision does not come to the aid of the petitioners.

18. As rightly pointed out by the learned Government Advocate (Crl. Side), a preliminary enquiry under Section 173(3) of BNSS is contemplated only in respect of cognizable offences punishable with imprisonment for three years or more but less than seven years, and even then it is left to the discretion of the officer concerned. In the present case, the offences under Sections 316(4) and

316(5) of BNS fall outside the said category. Therefore, the contention that the FIR is vitiated for want of a preliminary enquiry cannot be countenanced.

19. The remaining grounds urged on behalf of the petitioners, namely, that the losses of the company were due to market conditions or the mismanagement of the de facto complainant; that the de facto complainant evaded tax; that Ganapathy Green Fuels is owned by one Ilango and is a genuine supplier; and that the de facto complainant himself operates the bank account of the second petitioner, are all disputed questions of fact and, at best, matters of defence. They cannot be adjudicated upon in a petition filed under Section 528 of BNSS. Moreover, the petitioners have not placed any material before this Court to substantiate the same. On the contrary, the very fact that the first petitioner signed as the authorised signatory of a firm from which her own employer was making purchases is a circumstance which calls for investigation and not for interdiction.

20. The plea that the petitioners are widows leading a simple life, however sympathetic it may be, cannot by itself be a ground to quash an FIR which discloses the commission of cognizable offences.

21. The investigation is at a nascent stage and involves tracing the money trail across several bank accounts and third parties. This Court is of the considered view that interdicting the investigation at this stage would not be in the interest of justice. (D) CONCLUSION:

22. In the light of the foregoing discussion, this Court finds no merit in the petition. Accordingly, this Criminal Original Petition stands dismissed. Consequently, the connected miscellaneous petition is closed. 09-10-2026 Index: Yes/No Speaking/Non-speaking order Neutral Citation: Yes/No msa To

1. The Sub- Inspector Of Police, District Crime Branch, Dindigul District. Crime No. 45/2025.

2. The Additional Public Prosecutor Madurai Bench of Madras High Court Madurai

R.VIJAYAKUMAR,J. msa CRL OP(MD) No. 19357 of 2026 and Crl.MP(MD).No.18473 of 2026

09.10.2026