SC Slaps Rs25 Lakh Cost on Karan Gambhir for Filing False Criminal Complaint and Forum Hunting
Moneylife Digital Team 24 January 2024
Coming down heavily on one Karan Gambhir for filing a false criminal complaint and wishful forum shopping in a commercial dispute, the Supreme Court imposed a cost of Rs25 lakh on Mr Gambhir.
 
In an order earlier this month, the division bench of justice Vikram Nath and justice Rajesh Bindal says, "Mr Gambhir (the complainant), having misused the legal system by lodging false and frivolous complaint with non-disclosure of necessary facts, must bear its costs. The registration of the first information report (FIR) at Noida despite having registered offices of companies in question at Delhi shows a wishful forum shopping by the complainant (Mr Gambhir), casting serious doubts on their bona fides." 
 
"The complainant (Mr Gambhir) had already sought a remedy against the amalgamation order before the high court (HC) and the HC had dismissed the same. However, he chose to again use judicial mechanisms to raise his grievances. A criminal complaint was filed and an FIR was registered against the appellants despite the commercial nature of the dispute. Such ill-intended acts of abuse of power and legal machinery seriously affect the public trust in judicial functioning. Thus, we find ourselves constrained to impose a cost on complainant with a view to curb others from such acts leading to abuse of judicial remedies," the bench says.
 
Mr Gambhir owns DD Global Capital Pvt Ltd. He alleged that DD Global Capital extended a short-term loan of Rs5.16 crore to Gulab Buildtech Pvt Ltd and Rs11.29 crore to Verma Buildtech and Promoters Pvt Ltd. Later, the loan was converted into debt equity allegedly promising high returns from the real estate business to Mr Gambhir. The shares were allotted at an exorbitant price and Mr Gambhir acquired 21% shareholding in Verma Buildtech, whereas, in Gulab Buildtech, his shareholding was 4.53%.
 
Sushil Gupta, Rajesh Gupta and Dinesh Gupta are promoters of BDR Builders and Developers, Gulab Buildtech and Verma Buildtech and Promoters.
 
Some scheme of amalgamation was made by Gulab Buildtech and Verma Buildtech and Promoters to amalgamate them with BDR Builders and Developers Pvt Ltd, due to which Mr Gambhir alleged that the percentage of shareholding of DD Global Capital reduced considerably.
 
The Delhi HC approved the amalgamation, but Mr Gambhir alleged that the share certificates were never physically handed over to him.
 
Further, when he asked to return the loan with interest, initially, time was sought, stating that there was a slump in the real estate market, and after that, the Guptas started ignoring his queries, he alleged. Mr Gambhir then filed a complaint of cheating and forgery against the three companies and the Guptas.
 
Perusing the two resolutions passed by DD Global Capital vide which the decision was taken by Mr Gambhir to invest in the equity of Gulab Buildtech and Verma Buildtech, the apex court observed that the resolutions passed by Mr Gambhir have not been denied; hence, the claim that the Guptas had induced him to advance the loan and later on converted the loan into equity is totally false. "It was rather a deliberate decision taken by the board founded on company resolutions."
 
The SC also observed that it was a plain and simple transaction between the corporates. "Even as per Mr Gambhir's case, the short-term loan was advanced in 2010 for one year. However, when the same was not returned, no steps were taken by Mr Gambhir to recover it until the FIR in question was registered on 29 July 2018, i.e. eight years and seven months later."
 
"Further, Mr Gambhir came to know about the merger of the Gulab Buildtech and Verma Buildtech with BDR in 2013 itself. However, even after the dismissal of the application filed for recall of the merger order passed by the HC on 15 March 2016, no steps were taken to recover the amount, except getting the FIR registered more than two years later. All these facts clearly reflect upon the ill designs of Mr Gambhir," the SC says.
 
"The entire factual matrix and the timelines clearly reflect that Mr Gambhir deliberately and unnecessarily has caused substantial delay and had been waiting for an opportune moment for initiating false and frivolous litigation," the bench says. 
 
While quashing the FIR, the SC imposed costs of Rs25 lakh on Mr Gambhir. It asked him to deposit the money with the SC registry which will be transmitted equally to the Supreme Court Bar Association (SCBA) and Supreme Court Advocates-on-Record Association (SCAORA) for the development and benefit of their members.
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