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When a financial establishment and its directors face criminal prosecution under Section 5 of the Tamil Nadu Protection of Interests of Depositors (in Financial Establishments) Act, 1997 (TNPID Act) alongside Sections 120(B) and 420 of the Indian Penal Code following a market collapse, what is the legal consequence when the accused come forward during trial and repay every single depositor in full? Where 74 depositors directly depose before the Special Court confirming receipt of their money and the remaining 75th depositor's full claim is deposited into court, does continuing the decade-old criminal trial serve any useful purpose? In an authoritative ruling prioritizing restitution and substantive justice under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), the High Court of Judicature at Madras quashed the entire TNPID Special Court prosecution in C.C. No. 11 of 2015.

Case Details at a Glance

• Case Title: M/s. Achievers Agri India (P) Ltd. & 4 Others vs. State Rep. by the Deputy Superintendent of Police, Economic Offence Wing II, Salem
• Court Name: High Court of Judicature at Madras (Principal Seat)
• Coram / Judge Name: The Hon'ble Mr. Justice G.K. Ilanthiraiyan
• Case Number: Crl.O.P. No. 20223 of 2026 (CNR: HCMA011628102026) and Crl.M.P. No. 13494 of 2026
• Trial Court Proceeding Quashed: C.C. No. 11 of 2015 on the file of the Special Judge, TNPID Special Court, Coimbatore (Crime No. 1 of 2015, EOW-II, Salem)
• Order Pronounced Dates: 24-09-2026 & Clarified "For Being Mentioned" on 02-11-2026 (Uploaded on: 04-11-2026)

1. Factual Matrix: Market Collapse, Winding Up Petition, and EOW Prosecution

The first petitioner company, M/s. Achievers Agri India (P) Ltd., based in Salem, commenced operations on 05.05.2007 with petitioners 2 to 5 (M.S. Sivakumar, R. Madesh, R. Narrayanappa, and V. Padmanabasoundappan) serving as its Directors, introducing various financial and investment schemes. Following a sudden collapse in the financial market, the company was unable to repay its depositors on schedule. Demonstrating bona fide intent to distribute company assets equitably among creditors, the petitioners voluntarily filed a company petition in C.P. No. 15 of 2015 before the Madras High Court seeking winding up of the company and appointment of an Official Liquidator. By order dated 29.04.2015, the High Court appointed a Provisional Official Liquidator to take charge of the company's assets.

Meanwhile, on 13.01.2015, a de facto complainant named K. Jayanthi lodged a complaint with the Economic Offence Wing II (EOW-II), Salem. The respondent police registered Crime No. 1 of 2015 for offences punishable under Sections 120(B) and 420 of the Indian Penal Code (IPC) and Section 5 of the TNPID Act. As further complaints were received from other depositors regarding defaults totaling Rs. 41,23,420/- (clarified by the Court's order dated 02.11.2026), the investigating agency completed its probe and laid Charge Sheet No. 3 of 2015, which was taken on file as C.C. No. 11 of 2015 before the learned Special Judge, TNPID Special Court, Coimbatore.

2. Settlement of All 75 Depositors During Trial

According to the prosecution, the case involved a total of 75 victim depositors. During the course of trial before the TNPID Special Court in Coimbatore, 74 depositors were examined as prosecution witnesses (P.W.1 to P.W.74). While the trial was pending, the accused directors settled the claims of these victim depositors, and the depositors expressly deposed before the Trial Court confirming that they had received their money in full.

When the petitioners initially approached the High Court under Section 528 of the BNSS to quash C.C. No. 11 of 2015, the learned Public Prosecutor raised an objection pointing out that while 74 depositors had been settled, the claim of one witness—P.W.63—remained unsettled. Addressing this sole remaining claim, the petitioners deposited the entire amount due to P.W.63 directly before the TNPID Special Court. P.W.63 subsequently filed a memo before the Trial Court seeking permission to withdraw the deposited amount, which remained pending only because of the interim stay operating in the High Court quash petition.

3. Verification by the Prosecution and Judicial Reasoning

When Crl.O.P. No. 20223 of 2026 came up for final disposal before Justice G.K. Ilanthiraiyan, the learned Government Advocate (Criminal Side) verified the trial record and confirmed two decisive facts:

• 100% Repayment Confirmed: All 75 victim depositors had either been paid their respective amounts directly or had their full dues deposited into the Trial Court account (in the case of P.W.63).
• Sworn Depositions on Record: The victim depositors had already deposed before the TNPID Special Court confirming complete satisfaction of their claims.

"6. In view of the complete settlement, the continuation of the trial would serve no useful purpose. To secure the ends of justice, this Court is inclined to quash the entire proceedings."

4. Operative Order and Subsequent Clarification (02.11.2026)

Allowing Crl.O.P. No. 20223 of 2026, Justice G.K. Ilanthiraiyan issued the following operative directions:

1. Entire TNPID Prosecution Quashed: The entire criminal proceedings in C.C. No. 11 of 2015 pending on the file of the TNPID Special Court, Coimbatore, were quashed against the company and all its directors.
2. Disbursal Direction for P.W.63: The TNPID Special Court, Coimbatore, was directed to permit P.W.63 to withdraw the settlement amount already deposited by the petitioners/accused.
3. Rectification of Total Default Quantum (02.11.2026): Listed under the caption "For Being Mentioned" on 02.11.2026, the High Court directed the Registry to incorporate the corrected total default figure of Rs. 41,23,420/- (in place of Rs. 23,10,940/-) in Paragraph 3 of the order and issue a fresh order copy.

5. Legal Takeaways on Compounding and Quashing TNPID Prosecutions

The legislative object of the TNPID Act, 1997 is fundamentally remedial and restitutive—its primary goal is to ensure that hard-earned money invested by depositors is expeditiously recovered and returned, rather than merely inflicting punitive incarceration where full restitution has been achieved:

• Recording Settlement Through Prosecution Witnesses: Where depositors are examined as prosecution witnesses (P.W.1 to P.W.74) and confirm before the Special Judge that their dues have been settled in full, those sworn depositions form unimpeachable judicial record supporting a quash petition under Section 528 BNSS.
• Court Deposit for Unreachable or Holdout Depositors: If a single depositor (such as P.W.63) has not received direct payment, depositing their full claim amount to the credit of the Special Court removes the prosecution's objection and enables the High Court to quash the case while permitting the depositor to withdraw the funds.
• Rectifying Clerical Errors via "For Being Mentioned": Where a typographical discrepancy in the total claim figure appears in a final order, promptly listing the matter under the caption "For Being Mentioned" ensures that the High Court order accurately matches the Special Court charge sheet records, preventing any ambiguity before the Trial Court or Official Liquidator.

For specialized legal guidance on TNPID Special Court defense, Economic Offences Wing (EOW) investigations, depositor settlement recording, and High Court quash petitions under Section 528 BNSS, explore our services at SK Law House Criminal Defense Practice, view our full litigation portfolio at SK Law House Practice Areas, or contact our office via the SK Law House Contact Page.