‘Insider trading’: HC quashes ACB FIR against former A-G, others

In a major reprieve to former Advocate-General (A-G) Dammalapati Srinivas and 12 others accused of “insider trading” of lands in Amaravati, Justice Cheekati Manavendranath Roy of the Andhra Pradesh High Court on Thursday quashed the FIR registered by the Anti-Corruption Bureau under the Prevention of Corruption Act and various Sections of the Indian Penal Code(IPC).

The Judge ruled that Mr. Srinivas had the liberty to claim compensation or damages against the complainants for launching frivolous criminal proceedings.

Justice Roy observed that the former A-G neither had the authority to discharge any constitutional or statutory duties and functions nor had any role in the decision making process in locating the area where the capital was to be established and in bringing into force A.P. Capital Region Development Act, 2014.

Mr. Srinivas was also not privy to any information related to the exact location of the capital city. Therefore, the question of him disclosing the said information to the other accused and purchase of the lands by them in Amaravati on the basis of such information did not arise, and there was no truth in the allegation, Justice Roy noted.

Further, the Judge asserted that information about the location of the capital was not confidential and it was very much in the public domain from June 2014 itself, and the right to acquire property was a Constitutional and legal right of the petitioners as citizens of the country.

Since they purchased the lands in exercise of their rights from the owners/sellers who willingly and voluntarily sold the lands for valid sale consideration under registered sale deeds, the said private sale transactions could not be criminalised and no criminal liability could be attributed to the petitioners, the Judge said.

The concept of offence of insider trading which was essentially an offence in the field of stock market relating to selling and buying the securities and bonds could not be applied to the offences under IPC and could not be read into Section 420 thereof.

The sellers did not incur any loss on account of the said transactions and no conspiracy to do any illegal act or to commit an offence could be made out from the facts of the case, Justice Roy observed in a common order.

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