The dual bench of Justice AS. OKA & Justice Rajesh Bindal, of the Supreme Court of India, has held that mere failure to keep the promises will not amount to initiating Criminal Proceedings. A breach of contract does not give rise to criminal prosecution for cheating unless the fraudulent or dishonest intention is shown right at the beginning of the transaction.

CASE BRIEF

In this case, an F.I.R. was lodged against the accused under Sections 420, 120-B and 506 IPC on the basis of the complaint made by the informant. The accused approached the High Court seeking a quashing of the FIR but High Court refused to quash the complaint.

In appeal, the Apex Court noted that the allegations made are of civil nature. Perusing the complaints, the bench noted:

"The entire idea seems to be to convert a civil dispute into criminal and put pressure on the appellant for return of the amount allegedly paid. The criminal Courts are not meant to be used for settling scores or pressurise parties to settle civil disputes. Wherever ingredients of criminal offences are made out, criminal courts have to take cognizance. The complaint in question on the basis of which F.I.R. was registered was filed nearly three years after the last date fixed for registration of the sale deed. Allowing the proceedings to continue would be an abuse of process of the Court." 

The criminal Courts are not meant to be used for settling scores or pressurise parties to settle civil disputes.

In its judgement, the Court held that breach of contract does not give rise to criminal prosecution for cheating unless the fraudulent or dishonest intention is shown right at the beginning of the transaction.

Case Details:-

CRIMINAL APPEAL NO. 581 OF 2023
Sarabjit Kaur …Appellant
Versus
The State of Punjab & Anr. …Respondent

Appearances of the advocates:-

For Appellant(s) 
Mr. Amandeep Singh Jawandha,Adv.
Ms. Anju Kaushik,Adv.
Mr. Bankey Bihari, AOR
Mr. Birendra Bikram,Adv.

For Respondent(s)
Ms. Nupur Kumar, AOR