Yogesh Agarwal v. State of Karnataka
(2020) 8 Kant LJ 327
In the High Court of Karnataka
C.P. 3197/2020
Before Justice B A Patil
Decided on September 24, 2020

Relevancy of the case: Petition for quashing of FIR in a case involving corporate data theft and starting a competitive venture

Statutes and Provisions Involved

• The Information Technology Act, 2000 (Section 66, 72)
• The Indian Penal Code, 1860 (Section 34, 403, 406, 408, 426, 120B)
• The Code of Criminal Procedure, 1973 (Section 482)

Relevant Facts of the Case

• The complainant, Acko General Insurance Ltd. (Acko), allegedly developed sensitive information, including lists of clients, business models, business strategy and other trade secrets.
• Accused number 1 and accused number 2 (petitioners herein) were employees at Acko and were bound by non-disclosure agreements. Allegedly, they conspired to cheat and fraud Acko to steal their confidential information to establish a new competitive venture, named “Onsurity Services Pvt. Ltd.”
• They allegedly used the confidential information to make illegal financial gains and met Acko’s clients to stop them from doing business with Acko.
• FIR was filed, and here the petitioners have applied for quashing the proceedings.

Prominent Arguments by the Advocates

• The petitioner’s counsel argued that the complaint is very vague and that it was filed to tarnish the name and business of the petitioners. Further, a criminal veil has been given to civil matters. When the allegations in the complaint do not disclose the commission of the offence, the proceedings should be quashed under Section 482 of the Code of Criminal Procedure, 1973.
• The respondent’s counsel argued that the matter requires further investigation during the trial. If there is a prima facie case existing against the accused, then the Court cannot quash the proceedings.

Opinion of the Bench

• Neither the FIR nor the protest petition was frivolous. There is nothing to show that civil dispute was given a cloak of a criminal offence.
• Under Section 482 of the Code of Criminal Procedure, proceedings cannot be quashed if a case has been made out on the face of it. This matter requires a fair investigation, and there is prima facie material against the petitioners.
• No observations regarding the merits of the case are made.

Final Decision

• Petition dismissed.