Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(SC) 207

SUPREME COURT OF INDIA
Pamidighantam Sri Narasimha, Manoj Misra, JJ.
Vandana Jain & Ors. – Appellant
Versus
The State Of Uttar Pradesh & Ors. – Respondents
Criminal Appeal No. 1127 OF 2026 (Arising out of SLP (Crl) No. 6670/2021)
Decided On : 25-02-2026

Advocates appeared:
For the Petitioner(s): Mr. Pradeep Kant, Sr. Adv. Mr. Divyanshu Sahay, Adv. Ms. Shradha Narayan, Adv. Mr. Shubham Kumar, Adv. Mr. Akshay Sahay, Adv. Mr. Ketan Priyadarshee, Adv. Mr. E. C. Agrawala, AOR
For the Respondent(s): Mr. Shaurya Sahay, AOR Mr. Aman Jaiswal, Adv. Mr. Devvrat, AOR Ms. Harshita Sharma, Adv. Ms. Mridu J. Mukherjee, Adv. Mrs. Irul Srivastava, Adv. Ms. Tamanna Khan, Adv. Mr. Nitin Jain, Adv. Mr. Vinod Kumar Jaiswal, Adv. Mr. Subas Ray, Adv.

IMPORTANT POINTS
(1) Criminal breach of trust, cheating and forgery – Merely because a document is not traceable in records after several years of its issuance, it cannot be said that document is forged.
(2) Allegation about security money being not refunded would not make out a criminal offence though it may give rise to a civil cause of action.

Headnote:
Indian Penal Code, 1860 – Sections 406, 420, 467, 468 and 471 – Constitution of India – Article 226 – Criminal Procedure Code, 1973 – Section 482 – Criminal breach of trust, cheating and forgery – While considering prayer to quash FIR, ordinarily allegations made therein are to be taken at their face value to assess whether prima facie commission of a cognizable offence is made out or not – However, where cause espoused in FIR is essentially of a civil nature, while addressing a quashing petition, Court must have regard to attending circumstances and assess whether it has been given cloak of criminal offence and whether proceeding further on FIR would amount to abuse of process of court/law – In making such assessment, Court may consider not only contents of FIR but also admitted facts / documents recited therein – In present case, parties had executed a Joint Venture Agreement – Allegation that accused had falsely represented about there being no litigation qua the land/property is unfounded – In lieu of refund, security amount had to be adjusted from share of first party derived from sale proceeds – In such circumstances, allegation about security money being not refunded would not make out a criminal offence though it may give rise to a civil cause of action – Merely because a document is not traceable in records after several years of its issuance, it cannot be said that document is forged – Dispute between parties was purely of a civil nature arising from Joint Venture Agreement – Judgment and order of High Court set aside – Impugned FIR and all proceedings emanating therefrom hereby quashed. (Paras 15, 17, 20, 22, 24, 25, 26, 29 and 30)
Facts of the case:
Present appeal impugns judgment and order of High Court of Judicature at Allahabad dated 30.07.2021 passed in Misc. Bench No. 16314 of 2021 whereby writ petition of appellants seeking quashing of FIR under Sections 406, 420, 467, 468 and 471 of Indian Penal Code, 1860, has been dismissed.
Findings of Court:
If there was something stark about dishonest intention on part of one of parties to agreement, it would have been reported promptly and not after 10 years. This clearly indicates that dispute between parties was purely of a civil nature.
Result : Appeal allowed.

Judgement Key Points

Case Summary

This is a Supreme Court of India judgment dated 25-02-2026 in Criminal Appeal No. 1127 of 2026 (arising from SLP (Crl) No. 6670/2021), titled Vandana Jain & Ors. v. The State of Uttar Pradesh & Ors. (!) (!) (!) . The appeal challenged a High Court order dismissing a writ petition to quash FIR No. 0112/2021 registered under IPC Sections 406 (criminal breach of trust), 420 (cheating), 467, 468 (forgery), and 471 (using forged document) (!) (!) .

Facts

Appellants (first party: Vandana Jain, Siddharth Jain, Kanishk Jain, and Divya Bhatia) entered a Joint Venture Agreement (JVA) dated 16.08.2010 with Respondent No. 2 (second party: Motor General Sales Ltd.) for developing Plot No. 61 (old No. 276A), Azad Nagar, Kanpur (1500 sq. yards) (!) . First party's contribution: land valued at ₹2.5 crores (50% share). Second party: construction costs, 50% share, and ₹1 crore security money (₹50 lakhs advance + balance within 3 months), adjustable from first party's sale proceeds, not refundable (!) (!) (!) (!) (!) . Project timeline: 2 years post-approvals (KDA plan sanction, possession handover) (!) (!) . JVA included arbitration clause for disputes (!) (!) . Project failed; FIR lodged 14.03.2021 (11 years later) alleging non-handover, non-refund, false title representation (suppressed litigation with Indira Devi Kanodia), and forged documents (!) (!) (!) .

Key Issues and Holdings

Nature of Dispute: Dispute purely civil, arising from JVA breach; criminal proceedings abuse of process. While FIR allegations taken at face value ordinarily, courts assess if civil dispute cloaked as criminal, considering FIR contents, admitted facts/documents (!) (!) (!) . No dishonest intent from inception (evident from 11-year delay) (!) .
Cheating (IPC 420): No false representation. JVA history accurate; no explicit "no litigation" statement. Assurances limited to no attachments/restraints/taxes on land, indemnity for title—none falsified. Litigation with Indira Devi (post-2000, KDA-related) not misrepresented (!) (!) (!) (!) (!) (!) .
Criminal Breach of Trust (IPC 406): Security money non-refundable, adjustable against first party's share. Non-fulfilment gives

JUDGMENT :

MANOJ MISRA, J.

1. Leave granted.

2. This appeal impugns the judgment and order of the High Court of Judicature at Allahabad¹[High Court] dated 30.07.2021 passed in Misc. Bench No. 16314 of 2021 whereby the writ petition of the appellants seeking quashing of FIR²[First Information Report] No.0112 of 2021, dated 14.03.2021, lodged at Police Station (for short, P.S.) Hazratganj, District Lucknow, under Sections 406, 420, 467, 468 and 471 of the Indian Penal Code, 1860³[IPC], has been dismissed.

FACTS

3. Vandana Jain (appellant no. 1), Divya Bhatia, Siddharth Jain (appellant no.2) and Kanishk Jain (appellant no.3), described as first party, entered into a joint venture agreement⁴[JVA] dated 16.08.2010 with Motor General Sales Ltd. (Respondent No.2), described as second party. As per the terms and conditions of the JVA, the first party gave development rights to the second party for developing land i.e., Plot No. 61 (Old No. 276A), admeasuring 1500 Square Yards, bearing Municipal No. 3A/207 & 208, Azad Nagar, Kanpur. Under the agreement, the second party was required to construct residential units/apartments over the land at its own cost. The capital contribution of the first party was the land which was valued at Rupees Two Crores Fifty Lacs Only. The project was to come up as a single unit in which both first and second party had 50% share.

4. Under the JVA, the second party undertook to complete the project within two years, upon fulfillment of certain conditions such as (i) sanction of plan by Kanpur Development Authority⁵[K.D.A.]; and (ii) handing over of vacant possession of the site to the second party.

5. Clause 5 of the JVA, which is of some relevance, is being reproduced below:

“SECURITY FOR DUE COMPLIANCE OF AGREEMENT

For due performance of this Joint Venture Agreement, the Second Party will advance Rs. 10,000,000 (Rupees One Crore only) as security money to the First Party on receiving the physical possession of the vacant property of which second party will be giving Rs. 50,00,000/- (Rupees Fifty Lacs only) lacs in advance and there after the balance amount to be given to the first party within 3 months. However, if the second party is not in position to give the balance of the funds from his own sources within 3 months, then the first party will be entitled to retain the booking amounts to the extent of Rs. 50,00,000/- (Rupees Fifty Lacs only).

This amount of advance will be adjusted from the share of the first party from sale proceeds of the said flats in the complex of the share of the first party.”

6. Clause 7 of the JVA provided for arbitration in the following terms:

“ARBITRATION:

All disputes or differences relating to breach of contract or damage or otherwise in connection with the terms of this contract during or after completion or interpretation of the terms etc. among the parties or their prospective purchasers the same shall be referred for the arbitration under Indian Arbitration Act in force. Neither party will have any right to approach Civil Court pertaining to arising out of any matter directly or indirectly of this agreement of Joint Venture without resorting to this arbitration clause. The award of arbitrator shall be final, conclusive and binding upon the parties.”

7. For certain reasons, not necessary to be disclosed in these proceedings, the JVA could not materialize, resulting in dispute between the parties. In consequence, on 14.03.2021, the second respondent lodged the impugned FIR implicating the appellants along with Divya Bhati as accused.

The First Information Report

8. In the FIR it was, inter-alia, alleged: (a) that despite receiving Rs. 1 Crore as security for due compliance of the JVA, the accused did not hand over possession of the land; (b) that despite repeated demands for return of the advance money, the accused did not return the same; (c) that the accused made a false promise that the land was free from litigation; (d) that the accused had forged documents to deceive the co