Criminal proceedings arising from private disputes with civil flavour may be quashed upon settlement to prevent abuse of process.

The petitioners filed this Criminal Miscellaneous Petition to quash the order taking cognizance dated February 10, 2023, passed by the Judicial Magistrate-1st Class, Giridih, in Complaint Case No. 841 of 2022.

The Magistrate had found a prima facie case against the petitioners for offences under Sections 406 (criminal breach of trust), 420 (cheating), and 120B (criminal conspiracy) of the Indian Penal Code.

During the pendency of the petition, the parties filed Interlocutory Application No. 3760 of 2026, supported by affidavits, stating they had resolved their dispute through a Memorandum of Understanding mediated by well-wishers.

The complainant (Opposite Party No. 2) expressed a desire not to proceed with the case, noting the dispute was private and primarily civil in nature.

Whether the High Court should exercise its inherent power to quash criminal proceedings when the parties have reached a compromise in a dispute that is essentially private or civil in nature?

The court exercised its inherent power under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS).

It relied on the landmark precedent Parbatbhai Aahir @ Parbatbhai Bhimsinhbhai Karmur & Others v. State of Gujarat & Another (2017) 9 SCC 641, which incorporated principles from Gian Singh v. State of Punjab (2012) 10 SCC 303.

These precedents establish that while heinous crimes cannot be quashed via settlement, the High Court may quash proceedings arising from commercial, financial, or private disputes if the settlement renders the possibility of conviction remote and bleak, and where continuing the trial would constitute an abuse of process.

The court examined the nature of the allegations and noted that the offences under Sections 406, 420, and 120B of the IPC in this instance did not constitute "heinous" crimes or "offences of mental depravity".

Applying the Parbatbhai Aahir framework, the court found that the dispute was a private matter with a "civil flavour" involving no public policy concerns.

The court reasoned that due to the full and complete settlement between the offenders and the victim, any further continuation of the criminal proceedings would result in "great oppression and prejudice" to the petitioners.

Given that the complainant no longer supported the prosecution, the court determined that the chance of conviction was "remote and bleak," thus making the case fit for quashing to secure the ends of justice.

The court held that in light of the compromise, the continuation of the case would amount to an abuse of the process of law.

All pending interlocutory applications were disposed of accordingly.