The Apex Court recently held that a breach of contract does not give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction. Merely on the allegation of failure to keep up promise will not be enough to initiate criminal proceedings.

The bench of Justices Abhay S. Oka and Rajesh Bindal while quashing an FIR held that, "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."

Noting the facts of the case, the Apex Court held that an agreement to purchase a plot was executed on 17.05.2013 with one  Malkit Kaur. On the basis of the same, an agreement to sell took place on 18.11.2013. The execution of sale deed was fixed as 25.06.2014. It was mentioned in the agreement to sell that at the present vender was not the owner of the property. . The appellant received Rs. 5 Lacs. The data of execution was further extended to 24.12.2014. On 30.09.2015 a complaint was filed by the complainant. 

The investigation took place in the matter and it was opined that the dispute is civil in nature and no police action was required.

Case details:-

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

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