Magistrate’s 156(3) Order Upheld; Supreme Court Dismisses Challenges to Registration and Investigation of FIR

A bench of Justices Pankaj Mithal and S.V.N. Bhatti heard Special Leave Petitions arising out of the Delhi High Court’s refusal to quash an FIR registered on July 1, 2005 (FIR No.380/2005) and the Metropolitan Magistrate’s order directing its registration under Section 156(3) CrPC. The petitions challenged the High Court’s common judgment dated September 3, 2024, which had refused relief to VLS Finance Limited and its officers who sought quashing of the FIR and the magistrate’s order.

The Court held that while an informant ordinarily must first approach the police under Section 154 and then the Superintendent under Section 154(3) before invoking Section 156(3) CrPC, the magistrate’s order directing registration was not without jurisdiction and could not be interfered with after completion of investigation and filing of chargesheets. The Court emphasised that a magistrate exercising Section 156(3) must apply judicial mind and, where satisfied that a complaint discloses a cognizable offence, may direct registration. The Court, in its reasoning, observed: “On a conspicuous reading of the provisions of Sections 154, 156 and 190 of the CrPC together, it is crystal clear that an informant who wants to report about a commission of a cognizable offence has to, in the first instance, approach the officer-in-charge of the police station for the purposes of lodging an FIR. However, if such an information is not accepted by the officer-in-charge of the police station and he refuses to record it, the remedy of the informant is to approach the Superintendent of Police concerned. It is only subsequent to availing the above opportunities if he is not successful, he may approach the Magistrate under Section 156(3) CrPC for necessary action or of taking cognizance in accordance with Section 190 of the CrPC.” The Court also reproduced the magistrate’s order that he had “heard” counsel and “perused” the complaint, noting the magistrate’s recorded satisfaction that the complaint disclosed a cognizable offence: “The perusal of the complaint reveals the commission of cognizable offence and the SHO Police Station Defence colony is directed to get the case registered and investigate the matter.”

Background The dispute arose from a Memorandum of Understanding dated March 11, 1995 between Sunair Hotels Limited (SHL) and VLS Finance Limited (VLS). SHL alleged that VLS promised substantial equity support and a public issue at a premium which, in SHL’s view, was legally impossible under SEBI norms and that VLS concealed material facts. VLS in turn lodged multiple FIRs from 2000 onwards against SHL alleging siphoning and fraud. SHL initiated arbitration and was directed to refund a security deposit under an arbitral award under challenge in the Delhi High Court. In June 2004 SHL procured a magistrate’s order directing registration of FIR No.326/2004; that matter attracted litigation and an interim stay. On July 1, 2005 SHL filed another application under Section 156(3) CrPC before a Metropolitan Magistrate, which resulted in registration of FIR No.380/2005 at Defence Colony alleging offences under Sections 420, 120-B and 34 IPC. Investigations into FIR No.380/2005 were completed and chargesheets were filed (in 2020–21). VLS and its officers sought quashing of the July 1 order and the FIR before the Delhi High Court and, upon dismissal, moved this Court.

The Supreme Court reviewed statutory provisions (Sections 154, 156, 190 CrPC) and precedents including Sakiri Vasu, Ch. Bhajan Lal, King-Emperor and related authorities on the scope of inherent jurisdiction. The Court held that failure to first approach the police was a procedural irregularity but did not render the magistrate’s order without jurisdiction where the magistrate had recorded satisfaction that a cognizable offence was disclosed. The Court stressed that a magistrate must apply mind and issue a reasoned order under Section 156(3), but once an FIR disclosing cognizable offences had led to completed investigation and chargesheets, discretionary powers under Section 482 CrPC or Articles 226/227 were not ordinarily exercised to quash the FIR. The Court left contested factual and evidentiary issues to be decided in the criminal proceedings and dismissed the Special Leave Petitions, permitting the trial process to proceed.

Case No.: 2025 INSC 895 Case Title: ANURAG BHATNAGAR & ANR. v. STATE (NCT OF DELHI) & ANR. Appearances: For the Petitioner(s): Shri Jayant Bhushan; Shri Rajat Nair (learned counsel) For the Respondent(s): Shri Ranjit Kumar (learned counsel)