Back
SUPREME COURT OF INDIA
SANJIV KHANNA, CJI, SANJAY KUMAR, J.
Rikhab Birani & Anr. – Appellant
Versus
State Of Uttar Pradesh & Anr. – Respondents
Criminal Appeal No. 2061 of 2025 (arising out of SLP(Crl.) No. 8592 of 2024)
Decided on : 16-04-2025
Indian Penal Code, 1860 – Sections 420, 406, 354, 504 and 506 – Criminal Procedure Code, 1973 – Section 482 – Cheating, criminal breach of trust, insult and criminal intimidation – Cognizance and summoning order – Dismissal of quashing petition by High Court – Summoning order has to be passed when complaint or charge-sheet discloses offence and when there is material that supports and constitutes essential ingredients of offence – Summoning order should not be passed lightly or as a matter of course – It is duty and obligation of court to exercise great deal of caution in issuing process, particularly when matter is essentially of civil nature – Prevalent impression that civil remedies, being time-consuming, do not adequately protect interests of creditors or lenders should be discouraged and rejected as criminal procedure cannot be used to apply pressure – Failure to do so results in breakdown of rule of law and amounts to misuse and abuse of legal process – In present case, FIR does not state material and evidence available and collected during course of investigation to establish offences under Sections 420, 406, 354, 504 and 506 of IPC – FIR and resultant proceedings, including charge-sheet quashed with costs. (Paras 17, 18, 20 and 21)
Facts of the case:
It is the case of appellants that respondent No.2, Shilpi Gupta, had to pay 25 per cent of the total sale consideration amount as advance on or before 15.09.2020. However, she was unable to pay the same. In fact, a cheque of ?10,00,000/- (Rupees ten lakhs only) given by respondent No.2, Shilpi Gupta, bounced due to insufficient funds. Appellants relied upon some WhatsApp messages and other communications inter se them and respondent No.2, Shilpi Gupta, and her husband, whereby the latter was asked to pay the unpaid amount and complete the sale transaction by execution of a registered document. This was not done.
Findings of Court:
Costs will be paid by the State of Uttar Pradesh within a period of six weeks from the date of receipt of a copy of this order. It will be open to the State of Uttar Pradesh to conduct internal enquiries and collect this amount from the delinquent and responsible officers.
Result : Appeal allowed with costs.
This Supreme Court judgment allows the appeal filed by Rikhab Birani and Sadhna Birani against the State of Uttar Pradesh and Shilpi Gupta, quashing FIR No. 78/2023, the charge-sheet, cognizance order, and summoning order dated 17.01.2024. (!) [25][26]
Facts: The appellants entered an oral agreement in June 2020 to sell property (Roti Godown No. 28/27, Birhana Road, Kanpur) to respondent No. 2 (Shilpi Gupta) for Rs. 1.35 crores. Respondent No. 2 claimed paying Rs. 19 lakhs partly between June-September 2020, but failed to pay 25% advance by 15.09.2020; a Rs. 10 lakhs cheque bounced.[2][3][4] Appellants urged completion via registered sale deed through messages, but it did not occur. Appellants sold the property on 03.09.2021 for Rs. 90 lakhs due to changed circumstances, claiming Rs. 45 lakhs loss.[5][6] No civil suit was filed by either party.[7]
Procedural History: Respondent No. 2's Section 156(3) Cr.P.C. application and subsequent complaint were dismissed by Metropolitan Magistrate, Kanpur, as civil matters on 26.04.2022 and 14.07.2023.[7][8] She then lodged FIR on 22.07.2023 under IPC Sections 420 (cheating), 406 (criminal breach of trust), 354 (assault/outraging modesty), 504 (insult), 506 (criminal intimidation).[9] Anticipatory bail granted to appellants; charge-sheet filed 12.09.2023.[10][11] Magistrate took cognizance and summoned appellants on 17.01.2024 despite prior dismissals.[12] High Court dismissed Section 482 Cr.P.C. quashing petition on 09.05.2024.[13]
Key Holdings: - Summoning orders must not be issued lightly; courts must apply caution, especially in civil disputes like breach of contract, ensuring complaint/charge-sheet discloses offense with material supporting essential ingredients (e.g., mens rea/dishonest intent at contract inception for Sections 420/406 IPC). (!) - No criminal offenses made out: Dispute is purely civil (breach of oral sale agreement, non-refund, resale at loss); FIR/charge-sheet lack material/evidence on investigation findings to prove cheating (no dishonest inducement/deception at outset), breach of trust (no entrustment/fiduciary relation), or other sections (no intent to alarm/insult via threats).[14][15][16][17][20][21][24] (!) (!) (!) - Charge-sheet under Section 173(2) Cr.P.C. is incomplete/vague, merely repeating FIR without particulars/evidence for cognizance under Section 190 or summons under Section 204 Cr.P.C.[23][24] - Criminal process cannot pressure civil remedies; prevalent view that civil suits are time-consuming must be rejected to uphold rule of law. (!)
Result: Proceedings quashed; no observations on civil rights of parties.[25][26] Costs of Rs. 50,000 imposed on State of Uttar Pradesh (payable within 6 weeks, recoverable from delinquent officers); copy to Chief Secretary.[27][28] No costs on respondent No. 2 due to possible wrong advice.[29]
ORDER :
Leave granted.
2. The appellants, Rikhab Birani and Sadhna Birani, had entered into an oral agreement to sell Roti Godown No. 28/27, Birhana Road, Kanpur, Uttar Pradesh, to respondent No.2, Shilpi Gupta, for a consideration of Rs.1,35,00,000/- (Rupees one crore thirty five lakhs only) in June, 2020.
3. Respondent No.2, Shilpi Gupta, and her husband claimed that they had paid an amount of Rs.19,00,000/- (Rupees nineteen lakhs only) towards part-sale consideration between June and September, 2020.
4. It is the case of the appellants, Rikhab Birani and Sadhna Birani, that respondent No.2, Shilpi Gupta, had to pay 25 per cent of the total sale consideration amount as advance on or before 15.09.2020. However, she was unable to pay the same. In fact, a cheque of Rs.10,00,000/- (Rupees ten lakhs only) given by respondent No.2, Shilpi Gupta, bounced due to insufficient funds. The appellants, Rikhab Birani and Sadhna Birani, relied upon some WhatsApp messages and other communications inter se them and respondent No.2, Shilpi Gupta, and her husband, whereby the latter was asked to pay the unpaid amount and complete the sale transaction by execution of a registered document. This was not done.
5. After about one year, on 03.09.2021, the appellants, Rikhab Birani and Sadhna Birani, sold the aforesaid property by way of registered sale deed dated 03.09.2021 at the lower price of Rs.90,00,000/- (Rupees ninety lakhs only) statedly due to changed circumstances.
6. It is the case of the appellants, Rikhab Birani and Sadhna Birani, that they had suffered losses of Rs.45,00,000/- (Rupees forty five lakhs only) on account of the failure of respondent No. 2, Shilpi Gupta, and her husband, in paying the sale consideration amount and abiding by the oral agreement; hence, they are not liable to refund or pay any amount to respondent No.2, Shilpi Gupta.
7. It is the accepted position that neither the appellants, Rikhab Birani and Sadhna Birani, nor respondent No. 2, Shilpi Gupta, initiated any civil proceedings. On the other hand, respondent No.2, Shilpi Gupta, approached the Court of the Metropolitan Magistrate, Kanpur Nagar, for registration of a First Information Report1[For short, “FIR”.] by taking recourse to the provisions of Section 156(3) of the Code of Criminal Procedure, 1973. 2[For short, “Cr.P.C.”.] However, by the detailed and reasoned order dated 26.04.2022, the Metropolitan Magistrate, Kanpur Nagar, dismissed the application3[Misc. Case No. 4732/2021.] under Section 156(3) of the Cr.P.C., holding that this is a civil matter and no criminal offence is made out.
8. Respondent No.2, Shilpi Gupta, thereupon filed another criminal complaint4[Complaint Case No. 90180/2022.] on 14.06.2022 before the Court of the Metropolitan Magistrate, Kanpur Nagar. The Metropolitan Magistrate had, thereupon, called the Station House Officer of the Police Station – Harbans Mohal, District - Kanpur Nagar, Uttar Pradesh, to submit a report under Section 202 of the Cr.P.C. After receiving the report, the Metropolitan Magistrate, Kanpur Nagar, vide judgment dated 14.07.2023, dismissed the criminal complaint, holding that the matter is of civil nature.
9. Notwithstanding the two orders passed by the Metropolitan Magistrate, referred to above, respondent No.2, Shilpi Gupta, directly approached the Police Station – Harbans Mohal, District – Kanpur Nagar, Uttar Pradesh, and registered FIR No. 78/2023 dated 22.07.2023 for the offence(s) punishable under Sections 420, 406, 354, 504 and 506 of the Indian Penal Code, 1860. 5 [For short, “IPC”.]
10. Aggrieved thereby and apprehending their arrest, the appellants, Rikhab Birani and Sadhna Birani, filed an application for grant of anticipatory bail, which was granted to them till the filing of the chargesheet.
11. The investigating officer, on 12.09.2023, filed a chargesheet in the aforesaid FIR No.78/2023. We shall subsequently refer to the contents of the chargesheet.
12. On the aforesaid chargesheet being filed, the Metropol
Cognizance and summoning order – Dismissal of quashing petition by High Court – Summoning order has to be passed when complaint or charge-sheet discloses offence and when there is material that suppo....
Power under Section 156(3) warrants application of judicial mind. A court of law is involved. It is not the police taking steps at the stage of Section 154 of the Code.
Civil disputes should not be framed as criminal offences when no fraudulent intent is evident, as it constitutes an abuse of legal processes.
A mere breach of contract does not amount to a criminal offence unless fraudulent intent is established from the outset.
The court reiterated that a mere breach of contract does not constitute a criminal offence unless fraudulent or dishonest intention is established, quashing the FIR due to lack of supporting evidence....
The High Court established that criminal proceedings cannot be pursued for matters fundamentally rooted in civil disputes, reinforcing the principle against abusing the legal system.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
