CHENNAI: Noting that the audacity displayed by a police inspector in settling a civil dispute by using threats is a danger to the rule of law, the Madras High Court recently ordered a CB-CID probe into the allegations of coercion and extortion in settling a dispute between the shareholders of a private company.
Justice G Jayachandran passed the order on a petition filed by Sylvanus King Peter, Anitha Sylvanus King Peter and Sally Melisa seeking to quash an FIR registered by the Central Crime Branch (CCB) of Greater Chennai Police to settle a dispute raised by Balasubramaniam Sriram, one of the shareholders of Ocean Life Spaces India Private Ltd.
The petitioners alleged that police had registered the FIR on August 14, 2023, despite the fact the dispute between them and Balasubramaniam Sriram was seized by the National Company Law Tribunal (NCLT). The petitioners alleged that CCB officers, under the guise of investigation, arm-twisted them and extorted around Rs 50 crore.
The court noted that the status report filed by the Inspector of Police EDF-II of CCB stated that the parties have amicably settled the dispute as the company agreed to pay Rs 50 crore, and Rs 34 crore was paid towards a buyback of the entire share capital of 10% equity shares of the company held by Balasubramaniam Sriram, who had lodged the police complaint. The inspector had wanted the matter to be kept pending for further compromise in settlement.
The petitioners’ counsel alleged that the money paid and letters of payment of the sum were obtained under force, threat and coercion by the investigating officer. “This Court finds that it is a matter of a very serious nature and is to be probed by a specialised agency. When the defacto complainant (Balasubramaniam Sriram) approached the NCLT seeking a remedy of relinquishing the minority share of 10% for the value of Rs 13 crore, the payment of Rs 50 crore by the petitioner to buy back the 10% shares per se appears to be murky and suspicious,” the judge said.
He ordered the transfer of the case from the CCB to the CB-CID and for it to be probed by an officer, not below the rank of Superintendent of Police. If an inspector dares to settle a civil dispute which had already been seized of by the competent court under threats, then it is a danger to the rule of law, Justice Jayachandran observed. He posted the matter to the second week of February 2024.