Association fund-misappropriation proceedings were quashed as an abuse of process where no audit objection existed.

The petitioners, office-bearers of the Classique Paradise Apartment Owners Association, sought to quash an FIR registered against them under Sections 406 and 418 IPC.

The second respondent, an apartment owner, had earlier filed a civil suit concerning the Association’s elections; that plaint also made a general allegation that Association funds had been misappropriated.

In their written statement, the defendants asserted that the Association’s transactions were accounted for, externally audited, and placed before the AGM.

The subsequent criminal complaint alleged that the petitioners had spent Association funds on various works without approval and contrary to the bye-laws.

The High Court was informed that no audit objection concerning misappropriation had been raised.

Section 482 CrPC preserves the High Court’s inherent power to make orders necessary to secure the ends of justice or prevent abuse of the process of any court.

The Court invoked that power to quash proceedings it found to be baseless and an abuse of process.

The FIR invoked Sections 406 and 418 IPC, but the judgment does not separately set out the ingredients of those offences or rely on any cited precedent.

The Court considered the criminal complaint against the background of the pending civil dispute and the written statement, which specifically asserted that the Association’s transactions were accounted for and audited.

The complaint alleged unauthorised expenditure and misappropriation, but the respondent’s counsel confirmed that no audit objection had been raised.

On that record, the Court regarded the allegations as baseless and misconceived, and found force in the petitioners’ contention that the prosecution had been initiated to embarrass and coerce them after the civil suit was filed.

It therefore concluded that continuing the proceedings would abuse the process of law.