Byju’s CBI-ED Probe Plea Rejected as Karnataka HC Seized of Same Matter: Kerala HC

Voizzit Technology Pvt. Ltd Vs Director (Kerala High Court)

The Kerala High Court dismissed a writ appeal challenging the dismissal of a writ petition that had sought directions to the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) to investigate alleged malpractices by an Interim Resolution Professional and others, as well as to protect the interests of investors based on complaints submitted by the appellants. The Single Judge had dismissed the writ petition on the grounds that the appellants had earlier filed a Public Interest Litigation before a Division Bench, which they subsequently withdrew without seeking liberty to file a fresh petition. The Single Judge also noted that the appellants had already lodged a complaint before the Bengaluru Police, pursuant to which an FIR had been registered, and that the investigation had been stayed by the Karnataka High Court. The matter was also stated to be pending before the National Company Law Tribunal (NCLT), Bengaluru.

Before the Division Bench, the appellants contended that the complaints submitted to the CBI and the ED were distinct from the complaint lodged before the Bengaluru Police. They argued that the CBI and the ED could independently investigate the alleged irregularities in the corporate resolution process, including allegations that two companies belonging to the appellants had been sold despite having no connection with the loan transaction. They also asserted that the learned Single Judge erred in declining to direct an investigation into the alleged misconduct.

The CBI submitted that it could not investigate the matter unless it was referred by the State Government or pursuant to a direction of the High Court. The ED similarly contended that a predicate offence was necessary before it could initiate proceedings and pointed out that the matter was already pending before the Karnataka High Court. The respondents further argued that the complaints made to the CBI and ED were based on the same FIR registered by the Bengaluru Police, the investigation into which had already been stayed by the Karnataka High Court. They therefore submitted that any relief should be sought before that Court rather than before the Kerala High Court.

The appellants replied that the Karnataka High Court had granted only an ad interim stay without hearing them. They also argued that since their company was situated in Kerala and a commercial suit was pending before the Commercial Court at Ernakulam, the Kerala High Court possessed jurisdiction to entertain the matter.

After considering the submissions, the Division Bench examined the circumstances surrounding the earlier Public Interest Litigation. It observed that although the earlier petition had been withdrawn without liberty, the issues raised therein had not been decided on merits. The Court noted that withdrawal of proceedings before an inappropriate forum would not necessarily preclude a party from approaching the competent forum. However, it also observed that the dispute was essentially between private parties and that, following withdrawal of the PIL, the appellants had lodged a complaint before the Bengaluru Police, resulting in registration of an FIR.

The Court found it significant that the FIR registered on the basis of the appellants’ complaint was already the subject of proceedings before the Karnataka High Court, which had granted a stay on the investigation. It held that whether the stay was ad interim or passed after hearing the parties was immaterial. The appellants remained free to approach the Karnataka High Court for vacating the interim order or for early disposal of the proceedings, or to seek appropriate relief before the Supreme Court. Since the complaints made to the CBI and ED sought further investigation into the same subject matter arising from the Bengaluru FIR, the Kerala High Court held that it could not issue directions that would effectively interfere with proceedings already pending before the Karnataka High Court.

FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT

This Writ appeal is filed by the appellants by challenging the judgment passed by the learned Single Judge of this Court in W.P(Crl)No.74/2026 dated 03.06.2026

2. We have heard the arguments of the learned counsel for the appellants. Adv. Sreelal N. Warrier, the learned Special Public Prosecutor appearing for R1, Adv. Jaishankar V. Nair, the learned Standing Counsel appearing for R2, Adv. O.M. Shalina, the learned Deputy Solicitor General of India appearing for R3, the learned Senior Counsel, Adv. Joseph Kodianthara, along with Adv. Cyriac Tom and Adv. Varsha K. Balakrishnan, appearing for R4, Adv. S. Sreekumar, learned Senior counsel appearing for R5 and Adv. Harikumar G. Nair, the learned counsel appearing for R6 to R9.

3. The case of the appellant/petitioner(s) is that the petitioner filed a writ petition seeking a direction to Respondent No. 1, the Director of the CBI, and Respondent No. 2, the Director of the Enforcement Directorate, to enquire into or investigate the mal­practices alleged to have been committed by the Interim Resolu­tion Professional along with Respondents 4 to 6, and to protect the interests of the investors by considering Exts. P2 and P3, which are stated to be the complaints submitted by the petitioner(s) before Respondents 1 and 2 respectively. The learned Single Judge of this Court, after hearing the arguments, dis­missed the writ petition. One of the grounds for dismissal was that the petitioner(s) had already approached a Division Bench of this Court by filing W.P.(PIL) No. 171 of 2025 and had subse­quently withdrawn the same without seeking liberty to file a fresh petition. Therefore, the matter had already attained finality and could not be raised again in the present writ petition. The further ground for dismissal of the writ petition was that the petitioner(s) had already filed Ext. P1 complaint before the police at Ben-galuru. Pursuant thereto, a crime was registered by the High Grounds Police, Bengaluru. Thereafter, Respondents 4 to 6 filed a petition under Section 482 Cr.P.C. before the High Court of Kar­nataka, wherein FIR and investigation was stayed. Therefore, the learned Single Judge held that, since the petitioner had already approached the jurisdictional police for investigation and the same had been stayed by the High Court of Karnataka, no direc­tion could be issued to Respondent No. 2 for a further investiga­tion. It was also stated that the matter is pending before the Na­tional Company Law Tribunal, Bengaluru, in C.P.(IB) No. 149/ BB/2023. On the aforesaid grounds, the writ petition was dis­missed. Aggrieved by the said judgment, the petitioner(s) has pre­ferred the present writ appeal before this Court.

4. The learned counsel for the petitioner(s) strenuously argued that the allegations made in Ext. P1 are altogether differ­ent from the allegations made in Exts. P2 and P3. The complaints made by the petitioner(s) before the CBI as well as the Enforce­ment Directorate are distinct from the complaint in Ext. P1. It was submitted that the CBI and the Enforcement Directorate can independently investigate the allegations made by the petitioner(s) in the said complaints and submit their reports. The learned counsel further submitted that several malpractices have oc­curred in the resolution process. It was also contended that two companies belonging to the petitioner(s) were sold by the Resolu­tion Professional, though they were unconnected with the loan transaction. Therefore, according to the learned counsel, it is nec­essary for this Court to issue directions to the CBI as well as the Enforcement Directorate to conduct an investigation, hence prayed for allowing the appeal.

5. The learned counsel argued at length and contended that the learned Single Judge committed a grave error without re­ferring the matter for investigation. It was further contended that the respondents had cheated the petitioner(s) of billions of dollars by selling the properties of the petitioner’s companies. Therefore, it was submitted that a thorough investigation into the matter is necessary.

6. Per contra, the learned Special Public Prosecutor appearing for Respondent No. 1 (CBI) submitted that the CBI has certain limitations in investigating the matter. Unless the matter is referred by the State Government or a direction is issued by the High Court, the CBI cannot undertake an investigation. Therefore, it is not possible for the CBI to investigate the matter at this stage. The learned Standing counsel appearing for Respondent No. 2 also adopted the same contention. It was submitted that there must be a predicate offence for the Enforcement Directorate to initiate an investigation and that the matter is already pending before the High Court of Karnataka. Therefore, Respondent No. 2 cannot be called upon to act on the complaint of the petitioner(s). Hence prayed for the dismissal of the appeal.

7. The learned counsel appearing for Respondents 3 to 6 seriously contended that, as per the allegations made in Exts. P2 and P3, particularly in paragraph 2 thereof, the petitioner has sought an investigation in respect of the FIR registered by the High Grounds Police, Bengaluru, in Crime No.0044/2025. How­ever, the said investigation has already been stayed by the High Court of Karnataka by order dated 17.03.2025 in Criminal Peti­tion No. 3717/2025. Therefore, this Court cannot interfere in the matter at this stage. It was further submitted that the matter is already pending before the High Court of Karnataka and if the pe-titioner(s) seeks any relief, the same has to be urged before the said Court and not before this Court. Accordingly, the learned counsel prayed for the dismissal of the appeal.

8. In reply, the learned counsel appearing for the appel­lant once again argued that the order passed by the learned Sin­gle Judge of the High Court of Karnataka in Criminal Petition No. 3717/2025 is only an ad interim stay order granted without hear­ing the petitioner(s). Therefore, it was contended that the peti-tioner(s) had no occasion to argue the matter before the High Court of Karnataka. The learned counsel further submitted that the company run by the petitioner is situated in Kerala and, therefore, the petitioner(s) can invoke the jurisdiction of this Court. Hence, this Court has the jurisdiction to entertain the peti­tion. He further argued that the petitioner has already filed a commercial suit, which is pending before the Commercial Court, Er-nakulam. Hence prayed for allowing the appeal.

9. Having considered the arguments advanced by the learned counsel on either side and perused the records, particu­larly the impugned judgment passed by the learned Single Judge of this Court. It is evident that the petitioner had admittedly filed W.P.(PIL) No. 171 of 2025 before a Division Bench of this Court and subsequently withdrew the same without seeking leave of the Court to file a fresh petition. Though the learned counsel for the appellant(s) contended that the petitioner had approached a wrong forum and that the matter was neither heard nor decided on merits, and therefore the principle of res judicata would not apply to the case on hand, the learned Single Judge relied upon the judgment of the Hon’ble Supreme Court in Kangra Central Co-operative Bank Ltd. v. The Kangra Central Co-operative Bank Pensioners Welfare Association & Ors. [2025 SCC On-Line SC 2771], wherein it was held that even the SLP is dis­missed by the Hon’ble Supreme Court the litigant can approach the High Court for filing the review petition and there is no need for seeking libery from the court. However, in the present case, the Division Bench had dismissed the writ petition (PIL) as with­drawn at the request of the petitioner/appellant(s). Of course, merely because a party chooses a wrong forum and thereafter withdraws the proceedings to approach the appropriate forum, it may not preclude such party from seeking justice before the com­petent forum or court. It is also pertinent to note that W.P.(PIL) No. 171 of 2025 was dismissed as withdrawn. The said writ peti­tion was filed as a Public Interest Litigation, though there is no public interest was directly involved in the dispute. The dispute was essentially between private parties, wherein allegations were made that substantial losses had been caused to the petitioner(s) and that the matter had wider economic ramifications. However, the issues raised therein were not considered on merits. There­after, the petitioner appears to have lodged a complaint before the Bengaluru Police, pursuant to which FIR in Crime No.0044 of 2025 was registered by the High Grounds Police Station, Bengaluru at Karnataka State.

10. Admittedly, the FIR registered by the police on the basis of Ext. P1 complaint made by the petitioner has been seized of by the High Court of Karnataka in the criminal petition referred to above, and an order of stay has been granted therein. Whether the stay was granted as an ad interim measure or after hearing the parties does not matter. The petitioner still has the liberty to file an application before the High Court of Karnataka seeking to vacate the interim order or for early disposal of the main petition. Alternatively, he may approach the Hon’ble Supreme Court seek­ing to set aside the said order. Such being the case, when the matter is already pending before the High Court of Karnataka in a criminal petition arising out of the same allegations in Ext.P1, and when Exts. P2 and P3 seek a direction to Respondent Nos. 1 and 2 to take up further investigation based on Ext.P1 in Crime No.0044 of 2025, this Court is of the view that the matter has al­ready been seized of by the High Court of Karnataka. Therefore, no direction can be issued by this Court in respect of the same subject matter.

11. Such being the case, the petitioner(s) cannot once again approach the High Court of Kerala seeking the same relief. It is an admitted fact that the respondents are situated in Ben-galuru and that the proceedings before the NCLAT are also pend­ing in Bengaluru. The petitioner(s) had already chosen to file a complaint Ext.P1 before the Bengaluru Police. His complaint was filed in February 2025, and subsequently, in March 2025, the High Court of Karnataka stayed the investigation. Thereafter, Exts. P2 and P3 were submitted before the CBI and the Enforce­ment Directorate only on 15.12.2025, nearly nine months after the High Court of Karnataka had seized of the matter. Such being the case, at this stage, this Court, or even a Division Bench of this Court, cannot interfere with the order passed by the High Court of Karnataka which stayed the investigation. Until the stay order is vacated, the High Grounds Police, Bengaluru also cannot proceed with the investigation. Such being the case, there is no question of directing the CBI or any other investigating agency to take over the investigation of Crime No. 0044 of 2025 registered by the High Grounds Police, Bengaluru. Therefore, the learned Single Judge of this Court has rightly dismissed the writ petition, and the im­pugned judgment calls for no interference. Accordingly, the writ appeal is liable to be dismissed.

Accordingly, this Writ Appeal is dismissed. The appellant(s) is at liberty to approach the High Court of Karnataka for appropriate reliefs, if so advised.