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SC stays Andhra HC proceedings initiated against relief to media mogul Ramoji Rao's chit fund company

New Delhi: The Supreme Court has stayed the proceedings initiated before the Andhra Pradesh High Court challenging the Special Court’s refusal to take cognisance of offences in FIRs lodged against media mogul C Ramoji Rao promoted Margadarsi Chit Fund Pvt Ltd by the Y S R Jagan Mohan Reddy government.

A bench of Justices Abhay S Oka and Pankaj Mithal issued notice to the state government and others on a transfer petition filed by M/s Margadarsi Chit Fund Pvt Ltd.

The court sought a response from the Andhra Pradesh government by February 2, 2024.

“In the meanwhile, the High Court will not proceed with the hearing of criminal appeal Nos 669 and 670 of 2023 subject matter of these Transfer Petitions,” the bench said.

The court passed its order on December 15, 2023 after hearing senior advocates Sidharth Luthra, S Nagamuthu and advocate Mayank Jain for the petitioner.

The matter before the Andhra Pradesh High Court was related to appeals against the district court’s order to return the charge sheet on the ground there is no default alleged or shown over there. The Special Court had declined to take cognisance of the offence saying there is no material default under the AP Protection of Depositors Financial Establishment Act, 1999.

In the instant plea, the petitioner invoked Article 139A (2) of the Constitution which allowed the Supreme Court to transfer any case from one High Court to another if it is expedient for the ends of justice.

Their counsel contended similar issues related to quashing of the FIRs were pending before the Telangana High Court, so the matters pending before the Andhra Pradesh High Court should also be transferred over there.

The petitioner also pointed out the Supreme Court had the occasion to deal with a transfer petition filed on behalf of the State of Andhra Pradesh seeking the transfer of writ petitions filed for quashing FIRs from the High Court of Telangana to High Court of Andhra Pradesh.

On August 4, 2023, the Supreme Court had observed that the High Court of Telangana will decide the matters pertaining to quashing of FIRs on merits.

“The petitions seeking to quash FIRs are pending before the High Court of Telangana. Thus, the criminal appeals arising out of the same FIRs must be heard by the High Court of Telangana so as to avoid multiplicity of same proceedings before two different High Courts and conflicting judgments. The High Court of Telangana while entertaining the petition seeking to quash the chargesheet filed in FIRs would be well within its jurisdiction to entertain a petition seeking to challenge the order returning the same charge sheets,” their plea said.

The petitioner company incorporated in 1962 was turned into public limited company in 2002. It is claimed to be the largest chit fund company with an annual turnover of Rs 9,677 crore with subscribers base of over three lakh with 108 branches spread across four states in the country.

However, in 2019, the present ruling party, i e, YSRCP won the elections in Andhra Pradesh.

“After coming to power, the Chief Minister of the State of Andhra Pradesh has made several public utterances in derogatory terms against the petitioner company and its Chairman. It is evident from the said utterances that the actions of the state government against the petitioner and its management are an outcome of malafide and are an act of personal vendetta against them,” the petitioner said.

(Published 18 December 2023, 14:21 IST)

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