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2023 Supreme(SC) 467

SUPREME COURT OF INDIA
KRISHNA MURARI, SANJAY KAROL, JJ.
KUNTI AND ANR. – APPELLANTS
Versus
STATE OF UTTAR PRADESH AND ANR. – RESPONDENTS
CRIMINAL APPEAL NO. 1380 OF 2023 (@ SPECIAL LEAVE PETITION (CRIMINAL) NO.11673/2019)
Decided On : 03-05-2023

Advocates appeared:
For the Petitioner(s): Mr. Ashok Kumar Sharma, Sr. Adv. Mr. Vikalp Mudgal, Adv. Ms. Megha Gaur, Adv. Mr. Pankaj Sharma, Adv. Mr. Kshitij Mudgal, Adv. Mr. Ekansh Bansal, Adv. Mr. Vibhav Mishra, Adv. Mr. Parmanand Gaur, AOR
For the Respondent(s): Mr. Shailesh Pathak, Adv. Mr. Sarvesh Singh Baghel, AOR Mr. Pramit Saxena, AOR

A mere breach of contract does not give rise to criminal prosecution unless fraudulent or dishonest intention is shown at the beginning of the transaction.

Headnote:Criminal Procedure - Quashing of FIR - Code of Criminal Procedure, 1908, Section 482 - Indian Penal Code, 1860, Sections 406, 420, 467, 468, 417 and 418 The court considered an appeal against the judgment of the High Court dismissing an application to quash an order related to a criminal case under various sections of the Indian Penal Code. The dispute arose from an agreement to sell agricultural land and subsequent allegations of breach and forgery. The appellant argued that the agreement was void ab initio due to provisions in the Uttar Pradesh Zamindari Abolition & Land Reforms Act, and that the FIR was lodged four years after the scheduled execution date. However, the court held that the dispute was civil in nature and did not demonstrate fraudulent or dishonest intention for criminal prosecution. Citing precedents such as V. Ravi Kumar v. State and ARCI v. Nimra Cerglass Technics (P) Ltd., the court emphasized that a mere breach of contract does not give rise to criminal prosecution unless fraudulent or dishonest intention is shown at the beginning of the transaction.

Fact of the Case:

The appellant sought to quash an order related to a criminal case arising from an agreement to sell agricultural land.

Finding of the Court:

The court found that the dispute was civil in nature and did not demonstrate fraudulent or dishonest intention for criminal prosecution.

Issues:

Whether the agreement was void ab initio and if the FIR was lodged within a reasonable time.

Ratio Decidendi:

A mere breach of contract does not warrant criminal prosecution unless fraudulent or dishonest intention is demonstrated at the beginning of the transaction.

Final Decision:

The appeal was allowed, setting aside the judgment refusing to quash the FIR.

JUDGMENT :

SANJAY KAROL, J.

Leave Granted.

1. The present appeal arising out of special leave petition is directed against the judgement and order dated 18.10.2019 passed by the High Court of Judicature at Allahabad (hereinafter referred to as “the High Court”) in Application u/s 482, Code of Criminal Procedure, 1908, (hereafter “CrPC) No. 32337 of 2013, filed by the Appellants praying for quashing the order dated 22.11.2012 passed by the Chief Judicial Magistrate, Bulandshahr, in Case No. 6695 of 2012 arising out of Case Crime No. 421 of 2012 under Sections 406, 420, 467, 468, 417 and 418 of the Indian Penal Code, 1860. By the said judgement, the Hon’ble High Court dismissed the Application filed by the Appellant(s) and held that no grounds to interfere are found.

2. Brief facts necessary for the judgement in this appeal are as under:

3. The Appellant(s) in this case are Bhumidars of the agricultural land being Khasra No. 561/1 measuring 0.0550 and 0.1140 hectares in village Akbarpur, Bulandshahr, Uttar Pradesh (hereinafter referred to as the “property in dispute”). Allegedly, an agreement to sell in respect of the property in dispute, dated 11.07.2008 was executed by the Appellants in favour of the Respondent No 2. (Mr Ajay Kumar Bansal) for a consideration of Rs. 10,80,000/-. As it appears from the agreement, from the total amount, Rs. 6,30,000/- was transferred in favour of the Appellant by Respondent No. 2 as advance. The remaining amount of Rs. 4,50,000/- was agreed to be paid at the time of the execution of the sale deed. This agreement to sell was registered in the office of Deputy Registrar, First, Office at Bulandshahr, in Bahi No. 1, Zild No. 3910, Page 1 20, Item No. 4083.

4. The execution of the sale deed was extended from 11.07.2008 to 31.12.2008, by mutual consent, however, on the said date, despite Respondent No 2 herein being present, along with the amount remaining to be paid, the appellant was absent, in spite of having received information about the same.

5. It has been recorded in the Impugned order that, a notice was sent by Respondent No 2 on 01.01.2009, for execution of the agreement, after which, both parties met and an oral request to the same effect was also made. On various dates subsequent thereto, Respondent No 2 has extended the time in favour of the Appellant(s) herein for executing the sale deed, however, that was not done. Upon discovering that the appellant herein planned to sell the property in dispute to somebody other than the Appellant(s), the FIR, subject of the quashing proceedings was lodged at Police Station Kotwali, District Bulandshahr.

6. Vide the Impugned judgement dated 18.10.2019, the Ld. Single Judge dismissed the application under Section 482, CrPC, not accepting the argument on part of the Appellant, that the present Respondent No. 2 had an alternative remedy in the nature of a civil suit for the execution of the sale agreement. Relying on, in V. Ravi Kumar v. State 2018 SCC OnLine SC 2811, the prayer for quashing has been refused.

7. It has been urged by way of this appeal arising out of SLP, that the agreement to sell was void ab initio, in light of Sec. 157(A), Uttar Pradesh Zamindari Abolition & Land Reforms Act, 1950, whereby a person belonging to a Schedule Caste cannot transfer property to any person not of a schedule caste without prior permission of the concerned Collector or District Magistrate. Further it has been urged, that the instant FIR has been lodged four years after the slated date of the execution of the sale deed. It is also submitted that the present agreement to sell is forged and in respect thereof, a report to the Senior Superintendent of the Police stands filed.

8. We notice that the agreement to sell had been duly registered at the office Deputy Registrar, 1st, Office at Bulandshahr, and the complaint filed by the appellant, purporting that the same was forged, was filed on 11.05.2012, which is, incidentally, the same as the date of the reply to the legal not


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