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2025 Supreme(Online)(Bom) 6326
BOMBAY HIGH COURT
N. J. JAMADAR, J
Sushila Suresh Malge – Appellant
Versus
State of Maharashtra – Respondent
Anticipatory Bail Application No. 3218 of 2023
For the Appellants/Petitioners: Munir Merchant, Jenisha Gala, Sanjay Chaturvedi Associates
For the Respondents: A. S. Shalgaonkar, Mandar Soman, Bharat Manghani, Rashmi Joshi, Mehul Thakker, Bhandary & Bhandary
The distinction between civil breach and criminal deceit is critical; deceitful conduct to multiple victims constitutes an offense of cheating.
Headnote:(A) Indian Penal Code, 1860 - Section 420 - Anticipatory bail application rejected in relation to cheating allegations regarding fraudulent multiple sales of flats. The prosecution argued intent to deceive over civil dispute. Court highlights that civil breach does not preclude criminal liability if deceit is established. (Paras 23, 25)
(B) Cheating - Elements of deceit and dishonest intention established against the applicant due to evidence of multiple sales to different purchasers which led to a significant financial loss for them. (Paras 23, 24)
Facts of the case:
The applicant is accused of selling the same flat to multiple buyers under fraudulent pretenses, with significant sums being misappropriated from the buyers who were left deceived. The application for pre-arrest bail arose from a complaint indicating multiple instances of deceit in real estate transactions.
Findings of Court:
Applicants involved in real estate were shown to have engaged in systematic fraud by selling properties unlawfully to several individuals. Court emphasized that mere civil disputes could not mitigate the criminal context of the actions undertaken.
Issues: The key issues include whether the matter constitutes a civil dispute or a clear case of cheating with fraudulent intent.
Ratio Decidendi: The court concluded that where multiple persons are misled in an identical fashion, and fraudulent intent is established, the actions crossed from civil breach of contract to criminal deceit.
Result: Application stands rejected.
| Table of Content |
|---|
| 1. initial facts of deceitful flat sales established. (Para 2 , 3 , 4) |
| 2. arguments presented on civil nature vs. criminal intent. (Para 9 , 10 , 13) |
| 3. evidence of systematic fraud through multiple sales demonstrated. (Para 20 , 21 , 22) |
| 4. court's legal reasoning on distinguishing fraud from contract breach. (Para 23 , 24) |
| 5. final rejection of pre-arrest bail application affirmed. (Para 26) |
CORAM: N. J. JAMADAR, J.
DATED: 27th JANUARY, 2025 ORDER:-
1. Heard the learned Counsel for the applicant, the learned Counsel for the intervener and the learned APP for the State.
2. This is an application for pre-arrest bail in connection with CR No.155 of 2023, registered with Rabale Police Station, Navi MUmbai, for an offence punishable under Section 420 read with Section 34 of Indian Penal Code, 1860 (“the Penal Code”).
3. Jaspalsingh Malhotra, the first informant’s husband, had booked a flat in a Project Green World, Digha Airoli, Navi Mumbai, being Flat No.A2/1903. The said project was developed by M/s. Mount Mary Builders, of which the applicant Sushila Suresh Malge is the Proprietress. India Bulls Distribution Services Pvt. Ltd. was appointed as a marketing agent. An allotment letter was issued to Jaspalsingh Malhotra, on 3rd September, 2016 incorporating the terms of the contract.
4. Jaspalsingh passed away on 3rd November, 2020. As the daughter of the first informant received an e-mail on the account of the deceased, the first informant learnt that the deceased had booked the flat and paid Rs.1,00,11,000/-
towards consideration. The first informant alleged the first informant and her daughter approached the applicant and offered to pay the balance consideration, if any. The applicant and her husband Suresh Malge (A1), did not execute the instrument on one or the other pretext and, eventually, it transpired that the applicant had sold the said Flat No.A2/1903 for a consideration of Rs.1,13,00,000/- to a third party. Hence, report was lodged against the applicant and her husband Suresh Malge (A1).
5. The learned Additional Sessions Judge rejected the application for pre-arrest bail. However, the interim protection, initially granted, was continued.
6. On 9th January, 2023, when the application was listed before this Court, the said interim protection came to be continued, while directing the applicant to implead the first informant as a party respondent who had appeared on that day.
7. In the intervening period, Suresh Malge (A1) passed away. The application thus survives qua Sushila Malge (A2). The parties explored possibility of a mediated settlement of the dispute. As the negotiations did not materialize, the application was heard.
8. It would be contextually relevant to note that the applicant in IA/5368/2024 and IA/162/2025 are the persons, who had also purchased the flats in very same project and it, later on, transpired that the said flats were again sold to the third parties.
9. Mr. Munir Merchant, the learned Counsel for the applicant, submitted that the entire business operations were looked after and managed by Suresh Malge (A1). The applicant was the Proprietress of M/s. Mount Mary Builders for the namesake. Neither the applicant had made the inducement nor the applicant was instrumental in the alleged subsequent sale, during the substance of the earlier contract for sale.
10. Mr. Merchant further submitted that, at any rate, the dispute is purely of civil nature. The first informant had already approached Maharashtra Real Estate Regulatory Authority (MahaRERA) and orders have been passed by MahaRERA directing the applicant to refund the entire amount paid by the first informant towards the consideration, alongwith interest.
11. Mr. Merchant further submitted that the documents on record would clearly indicate that there was no dishonest intention on the part of the applicant. In fact, the first informant was given opportunity to pay the balance consideration and get the instrument executed. Attention of the Court
