The case pertains to a complaint made by a company, Ganesh Benzoplast Ltd, relating to availment of two inter corporate deposits of Rs. 50 lakhs in 2000 from Morgan Securities and Credits Pvt. Ltd. in respect of which 15000 equity shares of the company amounting to Rs.2.40 crore was pledged with Morgan Securities.
It has been alleged by Ganesh Benzoplast Ltd. that Morgan Securities fraudulently and intentionally did not sell the pledged shares when asked by Ganesh Benzoplast and sold the pledged shares to its sister concern later on the date when the market value of shares was much higher.
The bench of Justice RN Laddha and Justice Nitin Sambre granted three weeks time to the police to file reply to the interim application challenging the order passed by Magistrate of rejecting the closure report and directing further investigation. The matter has been adjourned to August 23.
In 2022, three directors including Suresh Chand Goyal approached the Bombay HC seeking quashing of the FIR registered by Mumbai police’s Economic Offences Wing (EOW). In their plea they had claimed the said FIR to be a second complaint levelling the same allegations as made in the first complaint which at the time of filing the petition was subject matter of challenge before the Supreme Court.
During the pendency of the matter before the Bombay High Court, EOW had filed closure report before the Metropolitan Magistrate, Mumbai. However, the Magistrate did not accept the closure report and instead directed further investigation.Adv. Vijay Aggarwal appearing for Suresh Chand Goyal and other directors, Meera Goyal and Prakash Agarwal of the company, Morgan Securities argued before the HC that the order of Metropolitan Magistrate of not accepting the closure report was, “ex facie illegal and argued that the entire allegations made by Ganesh Benzoplast was an abuse of process of law where the same allegations were made again”. Advocate Aggarwal appraised the bench of the 2022 order of the HC directing the EOW to not take coercive actions against the directors of Morgan Securities. He also informed the court that the earlier case against Morgan Securities and its directors was quashed by the Supreme Court.
The HC bench held “the fact remains that the Apex Court vide its detailed judgement has quashed the complaint In the aforesaid background, once the investigating agency has submitted a closure report and having regard to the above referred judgement by the Apex Court, we are of the view that the order of the Magistrate which appears to be later in point of time than that of the order of the Apex court, cannot be said to be prima facie sustainable.”
However, since the request for filing of reply is made, we deem it appropriate to stay the further investigation in the matter,” the order read.
Aggarwal questioned the delay in filing the second FIR. “The Supreme Court while quashing the first complaint, had held the first complaint itself to be suffering from an inordinate delay of ten years. The same shows the action of Ganesh Benzoplast to be an afterthought and suffering from malice intended to harass the directors of Morgan Securities” he argued.
On the other hand, the counsel for Ganesh Benzoplast argued that the said complaint was different from the complaint being quashed by Supreme Court and was based on certain new facts and allegations which have come to light subsequently and the Metropolitan Magistrate was right in not accepting the closure report and directing further investigation.