Settlement of dispute and refund of consideration amount warrants quashing of FIR in property-related criminal proceedings.

The petitioners, including a Senior Advocate of the Supreme Court, sought the quashing of an FIR (Kadamkuan P.S. Case No. 413 of 2023) registered under Sections 406, 420, 448, and 384/34 of the IPC.

The dispute arose when the complainant (Opposite Party No. 2) purchased a house from the petitioners’ mother, Dayamanti Singh, for Rs. 2 crore, only to have her allegedly demand an additional Rs. 5 crore post-sale.

The petitioners contended the property was subject to a prior family partition deed dated 21.07.2018 and an ongoing Title Suit (No. 425 of 2021).

During the pendency of this application, a settlement was reached on 04.12.2023, and the complainant was refunded Rs. 2.20 crore.

1. Whether the FIR and subsequent criminal proceedings against the petitioners and the co-accused should be quashed in light of the settlement reached between the parties.

The Court applied the inherent powers of the High Court to quash criminal proceedings, typically exercised under Section 482 of the Code of Criminal Procedure (CrPC), to prevent the abuse of the process of law.

The court looked at the settlement of the dispute, which essentially involved a property transaction and a private civil-commercial nature, identifying that the refund of the consideration amount satisfied the grievance underlying the charges of cheating (Section 420) and criminal breach of trust (Section 406) of the Indian Penal Code.

The Court examined the background of the dispute, noting it originated from a domestic property conflict involving a partition deed and a subsequent sale by the petitioners' mother.

It was observed that the petitioners were already pursuing a civil remedy (Title Suit No. 425 of 2021) to declare their rights.

Critically, the Court highlighted that a "deed of settlement" dated 04.12.2023 had been executed between the parties, and the complainant (informant) had been refunded the sum of Rs. 2,20,00,000/-.

Given the resolution of the financial dispute and the restoration of the status quo ante, the Court determined that continuing the criminal proceedings would serve no legitimate purpose and allowed the quashing application.

The Court allowed the application and quashed Kadamkuan P.S. Case No. 413 of 2023 for all offences against both petitioners and the co-accused, Dayamanti Singh. The Court granted the informant liberty to file a review application should any relevant, previously undisclosed information come to light.