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IN THE HIGH COURT OF JUDICATURE AT MADRAS
T.V. THAMILSELVI
R.Parthiban – Appellant
Versus
Inspector of Police – Respondent
ORDER :
T.V. THAMILSELVI, J.
1. The petitioners have filed this petition to quash the FIR in Crime No.228 of 2017 pending investigation on the file of the 1st respondent, for the offences under Sections 420 of IPC, as against the petitioners.
2. The case of the prosecution is that the petitioners are partners in M/s. R.P. Rajarajan Associates and owner of Multi-storied complex at a prime locality of Chennai. In order to clear the loan over the property, they decided to sell it. In that process, the 2nd respondent agreed to purchase the same and sale consideration was fixed as a sum of Rs.92 Crores. At the time the 2nd respondent was a member of the Income Tax Appellate Tribunal. The 2nd respondent agreed to take over the loan of Rs.29 Crores, borrowed by the petitioners to purchase the property. As advance she issued two cheques for Rs.10 Crores and Rs.8 Crores dated 01.08.2014 and 13.07.2014, agreeing to take over loan and pay the balance, but there was no written agreement. At the instruction of 2nd respondent one cheque for a sum of Rs.10 Crores alone was encashed on 13.10.2014. There was a delay caused by the 2nd respondent in taking over the loan of the petitioners with Indian
The court affirmed that an FIR under Section 420 IPC is not maintainable without prima facie evidence of dishonest intent or fraud, as mere contractual disputes do not constitute criminal cheating.
The main legal point established in the judgment is that the failure to fulfill contractual obligations can constitute cheating under Section 415 IPC if it causes harm to the other party.
FIR is an abuse of process of law and/or the same has been lodged only to harass the accused, the same can be quashed in exercise of powers vested under Article 226 of the Constitution or in exercise....
Criminal intent in property transactions leads to proceedings under IPC, regardless of parallel civil suits.
Civil disputes can involve criminal elements; thus, the existence of a civil remedy does not automatically justify quashing a criminal FIR.
Point of law: Criminal cases involving offences which arise from commercial, financial, mercantile, partnership or similar transactions with an essentially civil flavour may in appropriate situations....
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