Oral Judgment
1. The applicants before this Court have invoked the provisions of Section 482 of the Code of Criminal Procedure, 1973 (for short "Cr.P.C.) to quash and set aside the FIR being C.R.No.I-47 of 2017, dated 01.04.2017, lodged before the Navsari Town Police Station, District: Navsari, for the offence punishable under Sections 406, 420 and 120-B of the Indian Penal Code, 1860 (for short "IPC") and consequential proceedings arising out of the said FIR.
2. The brief facts as narrated in the FIR are to the effect that in the year 1998, the land namely Revenue Survey Nos.565/3 and 567/1 situated at Navsari Rustamwadi and Revenue Survey No.405 situated at Ghelkhadi, Navsari, total land admeasuring 6 Acre and 32 Guntha which was on the name of applicant No.1 and her two late sisters at that relevant point of time, purchased by the complainant by executing Satakhat with the applicant No.2 i.e. son of Applicant No.1 being the power holder of the said land, paying consideration of Rs.2,00,000/- in different installments on 09.01.1998, 12.11.1998 and 30.12.2006, with the promise to execute the sale deed in the name of the complainant as they had good relations. However, no sale deed was executed and only false promises were given to the complainant. In the year 2015, the complainant came to know that out of the said land, the land bearing Survey No.405 was sold to a person named Navinchandra Shivabhai Patel and his name was also mutated into the revenue records. Upon asking the same to the applicant No.2, he said that due to increase of the land price he would not execute the sale deed, and told to do whatever he can, and also refused to return the money which had taken from the complainant with regard to said land, hence, the present FIR is filed on 01.04.2017.
3. Learned advocate Ms. Kruti Shah for the applicant would submit that the impugned FIR suffers from suppression of material facts, inasmuch as prior to the lodging of the FIR which is dated 01.04.2017, one of the property as mentioned in the agreement to sell namely Revenue Survey No.565/3, admeasuring 1 Acre and 16 Guntha was already sold by registered sale deed dated 29.08.2006 which came to be registered in the year 2009. Thus, it is argued that by suppressing such material facts the complainant has tried to mislead the investigation agency.
3.1. Learned advocate would further submit that when the agreement to sell is dated 09.01.1998 which recites balance payment to be made within 8 months, however, the amount lastly paid was on 30.12.2006, the year in which sale deed qua one of the land was executed. Thus, there is no intention to cheat right from the beginning, and under such circumstances, alleged offence under Section 420 of IPC is not attracted.
3.2. Learned advocate for the applicant would further submit that there is gross delay in lodging of the FIR, inasmuch as after having entered into sale deed on 29.08.2006 and subsequent sale deed by the deceased applicant No.1 in the year 2014 which came to be registered in year 2015, the present impugned FIR is lodged on 01.04.2017. Thus, there is a delay of 11 years from the last payment made in year 2006, 2 years from the last sale deed executed by the applicant No.1, and almost 24 years after execution of the sale deed in the year 1998, without there being any justifiable reasons to lodge the FIR at a belated stage which itself creates a serious doubt inasmuch as there is no notice even issued by the present complainant for specific performance nor a suit is filed, and thus, having failed to avail any civil remedy, has lodged the present FIR which is nothing but abuse of process of law.
3.3. Learned advocate would also submit that even as on today despite of having executed the sale deed in the name of the complainant in the year 2006 which was registered in the year 2009, the names in the revenue records do not reflect the name of the complainant since he is not an agriculturist, and has thus, argued that since he knew that the land cannot be purchased by a non- agriculturist, the question of execution of sale deed did not arise, however, lastly upon much insistence had executed the sale deed qua one of the land in question in the year 2006, and despite of execution of another sale deed in the name of Navinchandra Shivabhai Patel, third party by applicant No.1, the complainant did not raise any dispute since he knew that he being not an agriculturist would not be able to succeed even by filing a civil suit, and thus, has lodged the present FIR with an oblique motive. Thus, it is argued to allow the present application.
3.4. Learned advocate Ms. Kruti Shah for the applicant has relied upon the following judgments to buttress her arguments:
1. Kishan Singh (D) through L.Rs. vs. Gurpal Singh & Ors., reported in 2010 (8) SCC 775.
2. Radheshyam & Ors. vs. State of Rajasthan & Anr., 2024 INSC 1064.
3. Delhi Race Club (1940) Ltd. and Others vs. State of Uttar Pradesh and Another, reported in 2024 (10) SCC 690.
4. G. Saminathan and Another vs. State, represented by the Sub-inspector of Police and Another, reported in 2026 (0) INSC 772.
5. Dalip Kaur vs. Jagnar Singh, reported in 2009 (0) AIJEL-SC 44091.
6. Sarabjit Kaur vs. State of Punjab, reported in 2023 (5) SCC 360.
7. Arshad Neyaz Khan vs. State of Jharkhand, reported in 2025 (0) AIR(SC) 4620.
4. Per contra, learned advocate Mr. J. A. Adeshra for the original complainant - respondent No.2 herein and learned Additional Public Prosecutor Mr. Rohan Shah for the State would submit that, the factum of agreement to sell being executed on 09.01.1998 is not disputed by the applicant as well as the factum of having paid sum of Rs.2,00,000/- for 3 parcel of land as stated in the agreement to sell is also not denied by the applicant herein, and the factum of having sold one piece of the said land in the year 2015 to third party namely Navinchandra Shivabhai Patel despite of having entered into an agreement to sell way back in the year 1998 is also not denied, and also executing an affidavit that except for Navinchandra Shivabhai Patel the property under question is neither sold, gifted, mortgaged, leased or has been transferred by way of any written agreement, and as such by stating these facts have clearly cheated the present complainant, and has thus, argued that prima facie case under Section 420 of the IPC is made out.
4.1. Learned advocate Mr. Adeshra would further submit that there is no delay in lodging the FIR since it came to the knowledge of the present complainant only in the year 2017 with regards to the sale deed being executed in favor of Navinchandra Shivabhai Patel that of Survey No.405, which was agreed to be sold to the present complainant by way of an agreement to sell way back in year 1998, and thus, there is no delay in lodging the FIR.
4.2. Learned advocate would also submit that the complainant waited for lodging of the FIR since he was pursuing the applicants herein and due to the relationship between the applicants and the complainant that the complainant did not lodge the FIR, however, despite of having waited for a substantial period of time when the property was alienated to third party that the FIR came to be lodged.
4.3. Learned advocate Mr. Adeshra would further submit that the contention raised by the learned advocate Ms. Kruti Shah for the applicant cannot be considered or looked into at the stage of quashing since the said aspects of defense which can be raised at the time of trial. Learned advocate would further submit that merely by not availing the civil remedy, it cannot be said that no offence has been committed, since both criminal and civil remedies can be availed either together or separately, and under such circumstances, non-preference of filing Civil Suit itself does not render the FIR unbelievable since prima facie case from the reading of the FIR itself is made out, and that, after thorough investigation the chargesheet has been filed, and therefore, the option available to the applicant is to face the trial, and that, this Court should not indulge into conducting mini trial at the stage of quashing which is impermissible under law.
4.4. Learned advocate also submit that the option available to the applicant is to file a discharge application before the trial Court since the chargesheet has already filed by the Investigation Agency, and when, one piece of lands is sold out of the total three piece of land which was agreed to be sold to the present complainant, and that too also the one piece of land being sold over and above the payment already paid for all the three land to the applicants way back in the year 2006, a clear case of cheating is made out, and has thus, argued to reject the present application.
4.5. Learned advocate Mr. J. A. Adeshra has relied upon the judgment in the case of Arun Bhandari vs. State of U P and Others, reported in 2013 (2) SSC 801 and judgment dated 12.07.2024 passed the Co-ordinate Bench of this Court in R/Special Criminal Application (Quashing) No.1199 of 2015, in the case of Kantilal Maganlal Shah and Anr. vs. State of Gujarat & Anr. to buttress his argument arguments.
5. It is pertinent to mention here that vide order dated 18.08.2026, this Court has abated the present application qua the applicant No.1 since she has expired on 08.09.2020.
6. Heard learned counsel for the applicant, learned Additional Public Prosecutor for the State, and learned advocate for respondent No. 2 (complainant).
7. Having perused the material on record and considered the submissions, this Court is of the considered opinion that the impugned FIR is liable to be quashed on the following legal grounds:
I. Deliberate Suppression of Material Facts (Mala Fide Intent):
7.1. A perusal of the impugned FIR reveals that respondent No. 2 deliberately suppressed the material fact that one parcel of land had already been conveyed to him by a registered Sale Deed in the year 2006. The Complainant painted a picture of total non-performance and deception. Deliberate concealment of registered public documents in an FIR demonstrates clear mala fide intent and an effort to mislead the investigating agency. The record reveals and it is not denied that out of the three land parcels mentioned in the 1998 Satakhat, the applicants actually executed a registered sale deed for Revenue Survey No. 565/3 (1 Acre 16 Gunthas) in favor of the complainant on 29.08.2006 (registered in 2009).
II. Absence of Essential Ingredients of Section 420 IPC (Cheating):
7.2. To sustain a charge under Section 420 IPC, dishonest intention (mens rea) must exist at the very inception of the agreement. The execution of a registered Sale Deed for one parcel in 2006 unequivocally establishes that the accused had no intention to deceive the complainant at the time of entering into the 1998 agreement. Subsequent non-execution of sale deeds for the remaining parcels may, at best, amount to a civil breach of contract, but cannot be assigned criminal character retroactively.
III. Non-Applicability of Section 406 IPC (Criminal Breach of Trust):
7.3. Payment of consideration or advance money under an Agreement to Sell does not constitute "entrustment" of property within the meaning of Section 405 IPC. Once advance money is received under a commercial or land contract, it becomes the property of the seller, subject to contractual terms. Thus, the essential ingredients of Section 406 IPC are entirely lacking.
IV. Inordinate Delay and Abuse of Process to Bypass Civil Limitation:
7.4. The chronology of events shows:
* 1998: Agreement to sell (Satakhat) executed.
* 2006: Last payment made; registered sale deed executed in 2006 for one parcel and Sale Deed registered in year 2009.
* 2014-2015: Sale deed executed for Survey No. 405 in favor of a third party.
* 01.04.2017: Impugned FIR lodged.
7.5. The complainant took no legal steps, neither issued a notice for specific performance nor filed a civil suit within the statutory period of 3 years under Article 54 of the Limitation Act, 1963. Having allowed his civil remedies to become barred by limitation, the complainant invoked criminal law 19 years after the agreement, 11 years after the last payment, and 2 years after the third-party sale. The explanation that he was "pursuing the applicants informally" is vague and unconvincing. Lodging an FIR in 2017 after allowing civil remedies to lapse is a classic instance of giving a purely civil dispute a criminal colour to harass the accused and bypass expired civil remedies (Ref: State of Haryana v. Bhajan Lal, 1992 Supp (1) SCC 335; Mitesh Kumar J. Sha v. State of Karnataka, 2021 SCC OnLine SC 976).
V. Abatement and Criminal Liability of POA Holder:
7.6. The principal owner (mother) has expired. The applicant acted strictly in his capacity as a Power of Attorney holder. In the absence of any independent criminal act attracting IPC offences, vicarious criminal liability cannot be fastened upon an agent for a transaction that is fundamentally civil in nature.
A. Judgments Cited by the Applicant
7.7. Sarabjit Kaur vs. State of Punjab (2023) 5 SCC 360 & Dalip Kaur vs. Jagnar Singh (2009) 14 SCC 696:
* The Supreme Court has consistently held that a mere failure to keep a promise or breach of an agreement to sell land does not automatically give rise to the offence of cheating under Section 420 IPC. Fraudulent or dishonest intention must be shown to exist at the time the promise/agreement was made (ab initio). Breach of an agreement to sell land does not automatically constitute cheating under Section 420 IPC unless dishonest intention at the time of making the promise is established.
* Application: In the present case, out of the three parcels of land included in the 1998 Satakhat, the applicants actually executed a registered sale deed for Revenue Survey No. 565/3 in the year 2006. This partial performance of the agreement directly refutes any claim that the applicants harbored an intent to deceive or cheat from the very beginning.
7.8. Kishan Singh (D) through L.Rs. vs. Gurpal Singh & Ors. (2010) 8 SCC 775 & Arshad Neyaz Khan vs. State of Jharkhand 2025 AIR (SC) 4620:
* Inordinate, unexcused, and long delays in lodging an FIR, especially when civil remedies such as a suit for specific performance are abandoned or barred by the law of limitation (Article 54 of the Limitation Act, 1963) create a strong inference of malicious prosecution aimed at seeking coercive leverage.
* Application: The last installment was paid in 2006, and the third-party sale occurred in 2014-2015. The complainant filed no civil suit for specific performance nor issued any legal notice, initiating criminal proceedings only on 01.04.2017 (19 years after the initial agreement and 11 years after the last payment).
7.9. Delhi Race Club (1940) Ltd. vs. State of U.P. (2024) 10 SCC 690, Radheshyam vs. State of Rajasthan 2024 INSC 1064 & G. Saminathan vs. State 2026 INSC 772:
* The High Court, in the exercise of its inherent powers under Section 482 Cr.P.C., must quash criminal proceedings where civil or contractual disputes are cloaked with criminal allegations to harass the accused. Furthermore, Delhi Race Club affirms that Section 406 (Criminal Breach of Trust) and Section 420 (Cheating) are mutually exclusive on the same set of facts, as entrustment and deception at inception cannot co-exist.
* Application: The transaction stems from an agreement to sell agricultural land. The failure to execute sale deeds for the remaining two parcels is a breach of contract, a civil wrong that cannot be converted into criminal offences under Sections 406/420 IPC.
B. Judgments Cited by Respondent No. 2 (Complainant)
7.10. Arun Bhandari vs. State of U.P. (2013) 2 SCC 801:
* In Arun Bhandari, the Supreme Court held that where an accused induces an innocent buyer to pay consideration under an agreement while deliberately concealing existing encumbrances and without any intention to convey the property, a criminal offence under Section 420 IPC is made out despite arising from a contract.
* Distinction: In Arun Bhandari, no part of the contract was ever performed, and active misrepresentation was present at the inception. In the current case, the applicants performed part of the contract by executing a registered sale deed for Survey No. 565/3 in 2006, disproving dishonest intent at inception. Thus, cited case if of no help to the complainant.
7.11. Kantilal Maganlal Shah vs. State of Gujarat (R/Spl. Cri. App. No. 1199 of 2015, decided 12.07.2024):
* The Gujarat High Court refused to quash an FIR where prima facie fraudulent intent at inception was clearly demonstrated on the record, without material suppression or unexcused long delays.
* Distinction: The present case differs fundamentally because the complainant suppressed the 2006 registered sale deed in the FIR and initiated prosecution after an unexplained delay of over a decade without pursuing civil remedies. Thus, the facts of the cited case are totally different from the facts on hand and the cited case if of no help tot he complainant.
8. One of the contention raise by learned Advocate Mr. J. A. Adeshra is that charge-sheet is laid before the competent Court and hence quashing petition is not maintainable and the applicant may prefer an application for discharge before the trial Court. Merely because a charge-sheet has been filed during the pendency of present application, the High Court is not constrained from exercising its inherent jurisdiction if the allegations, taken as a whole, do not disclose the commission of an offence and the prosecution is an abuse of process of law. In Anand Kumar Mohatta v. State (NCT of Delhi), (2019) 11 SCC 706, the Supreme Court squarely dealt with this plea and held that:
"Indeed, it would be a travesty to hold that proceedings initiated against a person can be interfered with at the stage of FIR but not if it has advanced, and the allegations have materialized into a charge sheet. On the contrary it could be said that the abuse of process caused by FIR stands aggravated if the FIR has taken the form of a charge sheet after investigation. The power is undoubtedly conferred to prevent abuse of process of power of any court."
9. Learned Advocate Mr. Adeshra would submit that the points raised by the applicants, such as the execution of a registered sale deed for part of the land in 2006, the complainant's non-agriculturist status, and the decade-long delay, are matters of defense that can only be evaluated during a full-fledged trial. That the impugned FIR, on its plain reading, discloses a cognizable offence under Section 420 IPC and at the stage of Section 482 Cr.P.C., this Court ought not to conduct a "mini-trial" or weigh conflicting evidence, particularly when investigation is complete and a charge-sheet has been submitted.
10. While the proposition that the High Court under Section 482 Cr.P.C. should not ordinarily conduct a mini-trial or appreciate contested defense evidence is beyond dispute, the said principle cannot be invoked as a rigid shield to sustain a manifestly malicious prosecution stemming from deliberate suppression of facts.
11. The contentions of the complainant are rejected for the following reasons:
1. The rule prohibiting the evaluation of defense material at the quashing stage is subject to a well-recognized exception: where the material relied upon by the accused consists of unimpeachable public records or registered documents, the court not only can but must look into them to satisfy its conscience and prevent an abuse of process.
2. In State of Orissa v. Debendra Nath Padhi, (2005) 1 SCC 568, and Rukmini Narvekar v. Vijaya Satardekar, (2008) 14 SCC 1, the Supreme Court held that defense material of indisputable character and unimpeachable quality can be considered at the Section 482 stage to judge whether the prosecution is sustainable.
3. In the present case, the Registered Sale Deed dated 29.08.2006 (registered in 2009) for Revenue Survey No. 565/3 is an undisputed public document. It is not an "arguable defense" requiring oral evidence--it is an established legal fact that completely dismantles the narrative of initial deception (ab initio) spun in the FIR.
4. Where the core ingredients of the offence are demonstrably absent even after investigation, requiring the accused to undergo the ordeal of a trial or file a discharge application constitutes unjustified harassment.
5. In the landmark decision of State of Haryana v. Bhajan Lal, 1992 Supp (1) SCC 335, the Supreme Court laid down specific categories where inherent powers should be exercised:
Category 1: Where the allegations made in the FIR, even if taken at their face value, do not prima facie constitute any offence.
Category 7: Where a criminal proceeding is manifestly attended with mala fide and/or maliciously instituted with an ulterior motive for wreaking vengeance.
5.1. The present case falls squarely under both Categories 1 and 7. The criminal law has been used as a tool of coercion to re-open a dead civil claim 19 years after the contract and 11 years after the last payment and 2 years after the last Sale Deed in favour of third party.
6. The Supreme Court has repeatedly cautioned that a complainant cannot keep a frivolous criminal proceeding alive merely by artful and clever drafting of the FIR. In G. Sagar Suri v. State of U.P., (2000) 2 SCC 636, the Apex Court held that:
"Jurisdiction under Section 482 of the Code has to be exercised with a great care. In exercise of its jurisdiction High Court is not to examine the matter superficially. It is to be seen if a matter, which is essentially of civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which High Court is to exercise its jurisdiction under Section 482 of the Code, Jurisdiction- under this Section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice. In State of Karnataka v. L. Muniswamy and Others, AIR (1977) SC 1489 = [1977] 3 SCR 113, this Court said that in the exercise of the wholesome power under Section 482 of the Code High Court is entitled to quash a proceeding if it comes to the conclusion that allowing the proceed-ing to continue would be an abuse of the process of the Court or that the ends of justice require that the proceedings are to be quashed."
11.1. The complainant deliberately omitted to mention the 2006 registered sale deed in the FIR to make out a false prima facie impression of complete fraud. To hold that this Court is blind to such material suppression under the pretext of "avoiding a mini- trial" would render Section 482 Cr.P.C. redundant.
12. In view of the settled position of law, permitting the criminal prosecution to continue against the Applicant in FIR No. C.R.No.I- 47 of 2017 would amount to a gross abuse of the process of the Court and result in a miscarriage of justice.
13. The application is allowed. The FIR being C.R.No.I-47 of 2017, dated 01.04.2017, lodged before the Navsari Town Police Station, District: Navsari, along with all consequential proceedings arising therefrom, are hereby quashed qua the applicant No.2 since the applicant No.1 already abated.
14. Rule is made absolute to the aforesaid extent. Direct service is permitted.
