{"id":308489,"date":"2023-12-06T09:00:40","date_gmt":"2023-12-06T03:30:40","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=308489"},"modified":"2023-12-08T12:33:27","modified_gmt":"2023-12-08T07:03:27","slug":"quashment-of-fir-in-contractual-dispute-due-to-lack-of-specific-allegations-and-delay-in-lodging-complaint-mp-hc-scc-blog","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2023\/12\/06\/quashment-of-fir-in-contractual-dispute-due-to-lack-of-specific-allegations-and-delay-in-lodging-complaint-mp-hc-scc-blog\/","title":{"rendered":"Madhya Pradesh High Court quashes FIR in contractual dispute due to \u2018lack of specific allegations and delay in lodging complaint\u2019"},"content":{"rendered":"
\n

Madhya Pradesh High Court:<\/span> In a petition filed under Section 482<\/a> of CrPC<\/a> seeking to quash FIR alleging criminal breach of trust under Section 409<\/a> of IPC<\/a>, stating misappropriation of toll funds by the petitioner, a single-judge bench comprising of Sanjay Dwivedi, J., allowed the petitioner’s plea, quashing the FIR and related proceedings, emphasising the absence of specific allegations and the civil nature of the dispute.<\/p>\n

Brief Facts<\/p>\n

In the instant matter, M\/s. Transstroy Bhopal Bypass Tollways (P) Ltd. entered into a 15-year contract (BOT) in 2010 for the construction of Bhopal Bypass Toll. A FIR was filed against the petitioner based on the Advocate General’s opinion that they misappropriated toll funds by not depositing the total collected amount in the escrow account, violating the terms of the contract.<\/p>\n

The petitioner preferred the present petition seeking to quash FIR, which alleged a criminal breach of trust under Section 409<\/a> of IPC<\/a> along with subsequent criminal proceedings arising from the said FIR.<\/p>\n

Moot Point<\/p>\n

    \n
  1. \n

    Whether the FIR and subsequent criminal proceedings against the petitioner, seeking to quash the FIR, are sustainable?<\/p>\n<\/li>\n

  2. \n

    Whether the dispute, arising from the termination of a contract between M\/s. Transstroy Bhopal Bypass Tollways (P) Ltd. and respondent 2, is of a civil or criminal nature?<\/p>\n<\/li>\n<\/ol>\n

    Parties’ Contentions<\/p>\n

    The Petitioner contended that the FIR is based on an illegal survey, not conducted jointly as per the agreement. It was contended that the contract termination occurred in 2018, and the petitioner is no longer a legal entity, making the FIR an abuse of process. It was contended that the Advocate General’s opinion, without specific allegations, does not justify criminal proceedings.<\/p>\n

    Respondent 2 contended that FIR is valid, alleging misappropriation of toll collections, breach of contract, and violation of Section 409<\/a> of IPC<\/a>. It was contended that the traffic survey\/sampling was conducted by an expert, revealing a significant discrepancy in toll collections. It was contended that the petitioner’s refusal to deposit the full amount in the escrow account justifies criminal proceedings.<\/p>\n

    Legal Principles<\/p>\n

      \n
    1. \n

      Disputes arising from contracts with specific arbitration remedies are civil in nature.<\/p>\n<\/li>\n

    2. \n

      Criminal proceedings should not be used as a tool to pressure parties to settle civil disputes.<\/p>\n<\/li>\n

    3. \n

      FIRs and criminal proceedings can be quashed if the allegations, even if true, do not constitute a prima facie offense.<\/p>\n<\/li>\n<\/ol>\n

      Court’s Decision<\/p>\n

      The Court observed that the dispute is civil in nature, arising from a terminated contract, and there is a specific remedy available through arbitration. The Court noted that the FIR was lodged almost two years after contract termination, lacks specific allegations against the petitioner for criminal breach of trust.<\/p>\n

      Emphasising the lack of specific allegations against the petitioner and absence of incriminating material, the Court concluded that the FIR was an abuse of process. Therefore, relying on precedent and categorizing the dispute as civil, the Court invoked its powers under Section 482<\/a> of CrPC<\/a> to quash the FIR and subsequent proceedings.<\/p>\n

      The petitions are allowed, and FIR along with subsequent proceedings is quashed.<\/p>\n

      [Kalyan Sunder v. State of M.P., 2023 SCC OnLine MP 4592<\/a>, order dated 28-11-2023<\/span>]<\/p>\n

      *Judgment by Justice Sanjay Dwivedi<\/span><\/strong><\/p>\n\n

      Advocates who appeared in this case :<\/p>\n

      Shri Siddharth Sharma, Counsel for the Petitioner<\/p>\n

      Shri Alok Agnihotri, Govt. Advocate, Counsel for the Respondent No. 1<\/p>\n

      Shri Anvesh Shrivastava, Counsel for the Respondent No. 2<\/p>\n

      Buy Penal Code, 1860   HERE<\/a><\/h3>\n

      \"penal<\/a><\/p>\n

      Buy Code of Criminal Procedure, 1973  HERE<\/a><\/h3>\n

      \"Code<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

      Madhya Pradesh High Court emphasised that a purely civil dispute should not be converted into a criminal prosecution.<\/p>\n","protected":false},"author":67514,"featured_media":291010,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[63251,63252,58674,63253,7201,50352],"class_list":["post-308489","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-highcourts","tag-contractual-dispute","tag-delay-in-lodging","tag-justice-sanjay-dwivedi","tag-lack-of-specific-allegation","tag-madhya-pradesh-high-court","tag-quashment-of-fir"],"yoast_head":"\nQuashment of FIR in contractual dispute due to lack of specific allegations and delay in lodging complaint: Madhya Pradesh High Court | SCC Blog<\/title>\n<meta name=\"description\" content=\"Quashment of FIR in contractual dispute due 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is \u201cnothing but the assimilation of personal and political antipathies, more precisely, a politically oriented-animosity, which makes the petitioner's prosecution malicious.\u201d","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Madhya Pradesh High Court","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/madhya-pradesh-high-court.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/madhya-pradesh-high-court.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/madhya-pradesh-high-court.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/madhya-pradesh-high-court.webp?resize=700%2C400&ssl=1 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2022","format":false,"excerpt":"Madhya Pradesh High Court: Anand Pathak, J. allowed a petition which was preferred under Section 482 of Code of Criminal Procedure seeking quashment of FIR registered against the petitioner and consequential\u00a0 criminal proceedings for offence under Sections 376, 506 of Penal Code, 1860.\u00a0 \u00a0 An FIR was registered by respondent\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Madhya Pradesh High Court","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/06\/MicrosoftTeams-image-250.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/06\/MicrosoftTeams-image-250.jpg?resize=350%2C200&ssl=1 1x, 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