Pranav B Prem

The National Company Law Tribunal (NCLT), Chennai Bench, has reiterated that it cannot invoke its criminal jurisdiction for alleged forgery or fabrication of documents unless the offence is shown to have been committed when the document was in the custody of the tribunal. Dismissing a batch of applications filed by Dr. Ravi Shankar Vedam, the tribunal held that allegations of forgery relating to documents created prior to their production before the court do not attract the procedure under the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023.

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The Division Bench comprising Judicial Member Sanjiv Jain and Technical Member Venkataraman Subramaniam was dealing with applications seeking initiation of criminal proceedings against M. Poobalan, authorised representative of Udhayaman Investments Pvt. Ltd., for offences relating to giving false evidence and fabrication of evidence. The applications arose from the corporate insolvvency resolution process initiated against Tiffins Barytes Asbestos and Paints Limited in 2018 on a Section 7 petition filed by Udhayaman Investments.

Dr. Vedam, a shareholder of the corporate debtor and brother of its former managing director, alleged that the insolvency proceedings were triggered on the basis of a forged Memorandum of Understanding dated April 16, 2016. According to him, two different versions of the MoU existed—one allegedly produced before a civil court at Bellary and another before the NCLT—and that a fabricated version was relied upon to initiate the insolvency process. On this basis, he sought directions under Sections 227 to 229 of the Bharatiya Nyaya Sanhita (BNS), 2023 read with Section 215 of the BNSS, contending that false evidence had been given and fabricated before the tribunal.

The respondents opposed the plea, arguing that similar allegations had been raised and rejected in earlier rounds of litigation, including before the NCLAT and the Supreme Court. It was also contended that the resolution plan had already been approved and implemented, and that the present applications were an attempt to re-agitate issues that had attained finality.

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While examining the maintainability of the applications, the NCLT analysed the scope of its powers under Sections 215 and 379 of the BNSS, which correspond to Section 195 and 340 of the erstwhile Code of Criminal Procedure. The tribunal noted that offences relating to false evidence and fabrication of evidence can be taken cognisance of only when such offences are committed in relation to proceedings before the court or in respect of documents while they are in custodia legis.

Relying on the Supreme Court’s decision in Iqbal Singh Marwah and another v. Meenakshi Marwah and another (2005), the tribunal reiterated that Section 195(1)(b)(ii) CrPC, now Section 215 of BNSS, is attracted only when the alleged offence is committed after the document has been produced or given in evidence in a court. Quoting the judgment, the tribunal noted that the provision applies only when the offence occurs “during the time when the document was in custodia legis.”

Applying this principle to the facts of the case, the NCLT observed that it was not the applicant’s case that the MoU dated April 16, 2016 was forged while it was in the custody of the tribunal. It further observed that there was no allegation that the respondent had given false evidence under oath or fabricated evidence during the proceedings before the NCLT. Accordingly, the tribunal held that the applicant’s reliance on Sections 227, 228 and 229 of the BNS was misplaced and that the relief under Section 215(1)(b)(i) and (ii) of the BNSS would not lie before it.

The tribunal also declined to interfere with the insolvency proceedings on the ground of alleged fraud or malicious initiation under Section 65 of the Insolvency and Bankruptcy Code. It observed that the applicant had failed to place any corroborative or substantial evidence to explicitly prove fraudulent or malicious intent in the initiation of CP(IB)/39/2018. The bench noted that the admission of the insolvency petition and approval of the resolution plan had already been upheld by the appellate tribunal and the Supreme Court.

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In conclusion, the NCLT dismissed all the applications, holding that the allegations of forgery and fraud were not maintainable within its limited criminal jurisdiction and that the applicant could not reopen issues that had already attained finality. No order as to costs was passed.

Appearance

For Applicant: Advocates V Venkata Sivakumar, T Deenadhayalam

For Respondent: Sr Advocate Omprakash

Cause Title: Dr. Ravi Shankar Vedam v. M Poobalan

Case No: IA(IBC)/462/CHE/2024 in CP(IB)/39(CHE)/2018

Coram: Judicial Member Sanjiv Jain, Technical Member Venkataraman Subramaniam