Telangana High Court refuses to quash cases against rice millers

Court says allegations of paddy diversion and misuse of government stock require detailed investigation and cannot be dismissed at the preliminary stage.

Hyderabad: The Telangana High Court has ruled that a detailed investigation must continue into allegations that rice millers diverted paddy supplied for milling for personal gain.

The court refused to quash criminal cases registered against several millers across the state over the alleged misappropriation of government-supplied paddy during the 2022-23 season.

According to the allegations, the millers failed to deliver rice to the government after receiving paddy for milling and defaulted on dues amounting to nearly Rs. 3,960 crore, equivalent to the value of the diverted stock. Criminal cases were registered against multiple millers across Telangana.

360 millers file petitions at HC

Nearly 360 millers filed 58 petitions in the High Court seeking to quash the FIRs. Justice J. Srinivas Rao recently heard the batch of petitions.

Counsel for the petitioners argued that the paddy supplied to the mills was of poor quality and claimed that the government had failed to clear milling-related charges.

State govt’s arguments

However, Advocate General A Sudarshan Reddy and Public Prosecutor Palle Nageswara Rao, appearing for the state, contended that the millers diverted the milling paddy and invested the proceeds in movable and immovable assets, including the film industry.

The court observed that once the millers accepted the paddy, they could not evade responsibility by later claiming that the grain supplied was substandard.

Justice Srinivas Rao stated that pending petitions related to the recovery of dues could not be grounds to halt criminal proceedings. The judge rejected the argument that the government had misused the legal process and also dismissed the claim that cases were filed without payment of milling charges, gunny bag costs, and storage charges.

“The charges can be claimed after handing over the rice. If government-owned paddy is misused while in the custody of millers, criminal cases can be registered,” the court observed.

The judge further noted that alleged defects in contractual agreements cannot be adjudicated in criminal petitions. The court also rejected the argument that FIRs should be quashed because they were filed four months after the inspection of the stock.

“These are matters concerning public interest. Delay alone is not sufficient to quash the FIRs,” the court said.

On the contention that officials involved in inspections were not made accused, the court said their role was limited at this stage, and any alleged conspiracy between millers and officials would emerge during the investigation.

Investigation still at preliminary stage: HC

The court observed that the investigation was still at a preliminary stage and there was sufficient prima facie material to proceed with the probe. It also held that the district manager of the Civil Supplies Corporation had the authority to lodge complaints.

Stating that the complaints contained specific allegations and disclosed cognisable offences requiring investigation, the High Court dismissed all the petitions filed by the millers and delivered a detailed 107-page judgment.