Supreme Court Quashes FIR in Civil Dispute: Usha Chakraborty vs. State of West Bengal (2023)

Introduction

Date of the Judgment: 30 January 2023
Citation: (2023) INSC 79
Judges: Hon’ble Justices Ajay Rastogi and C.T. Ravikumar

Can a criminal complaint be used as a tool to settle what is essentially a civil dispute? The Supreme Court of India recently addressed this question in a case where a criminal FIR was filed based on allegations that were rooted in a civil matter. The Court ultimately quashed the FIR, emphasizing that criminal proceedings should not be used to harass individuals or to resolve disputes that are fundamentally civil in nature. This judgment underscores the importance of distinguishing between civil and criminal matters and ensures that the criminal justice system is not misused.

Case Background

The case revolves around a dispute between Usha Chakraborty and Ashoka Chakraborty (the appellants) and Jayanta Banerjee (the respondent). The respondent filed an application before the Additional Chief Judicial Magistrate at Barasat, alleging various criminal offenses against the appellants. This application led to the registration of FIR No. 189/2017 at Madhyamgram Police Station. The appellants then approached the Calcutta High Court seeking to quash this FIR, arguing that the allegations were primarily civil in nature and that the criminal proceedings were an abuse of the legal process. The High Court, however, declined to interfere, stating that the case diary prima facie made out a case for investigation. This led to the appellants appealing to the Supreme Court.

Timeline:

Course of Proceedings

The appellants initially approached the Calcutta High Court under Section 482 of the Code of Criminal Procedure, 1973 (Cr.P.C.), seeking to quash the FIR. The High Court, however, declined to exercise its jurisdiction, stating that the case diary and materials prima facie made out a case for investigation. The High Court also vacated the interim order that had stayed further proceedings. The appellants then appealed to the Supreme Court, arguing that the High Court had failed to consider crucial contentions and that the dispute was essentially civil in nature, warranting the quashing of the FIR.

Legal Framework

The Supreme Court considered the following legal provisions:

• Section 482 of the Code of Criminal Procedure, 1973 (Cr.P.C.): This section deals with the inherent powers of the High Court to make orders necessary to give effect to any order under the Cr.P.C., or to prevent abuse of the process of any court, or otherwise to secure the ends of justice.
• Section 156(3) of the Cr.P.C.: This section empowers a Magistrate to order an investigation by the police into a cognizable offense.
• Sections 323, 384, 406, 423, 467, 468, 420, and 120B of the Indian Penal Code (I.P.C.): These sections pertain to various criminal offenses, including causing hurt (Section 323), extortion (Section 384), criminal breach of trust (Section 406), fraudulent execution of a deed of transfer (Section 423), forgery of a valuable security (Section 467), forgery for the purpose of cheating (Section 468), cheating (Section 420), and criminal conspiracy (Section 120B).

The Court examined how these provisions apply to the facts of the case, particularly focusing on whether the allegations made by the respondent disclosed the commission of a cognizable offense or if they were merely a civil dispute dressed up as a criminal matter.

Arguments

Appellants’ Arguments:

• The application filed by the respondent did not disclose the commission of any cognizable offense.
• The allegations were actuated by mala fides and were an attempt to harass the appellants.
• The dispute between the parties was purely civil in nature.
• The respondent had already resorted to civil remedies by filing a suit, and the criminal proceedings were an attempt to circumvent the civil process.
• The respondent suppressed the fact that he had been removed from the post of Secretary and from the membership of the Board of Trustees.
• The respondent concealed the pendency of a civil suit (Title Suit No. 363/2015) related to the same subject matter.

Respondents’ Arguments:

• The respondent alleged that the appellants had illegally registered the trust deed on 12.07.2016 and removed him from his post.
• The respondent claimed that the appellants had abused and assaulted him.
• The appellants had forcibly removed him from the school and withheld his necessary papers and documents.
• The respondent alleged misappropriation of his provident fund and forgery of ESI documents.
• The respondent stated that the police had not taken any action on his complaints.

Submissions Table

Issues Framed by the Supreme Court

The Supreme Court framed the following issue:

1. Whether the High Court was justified in declining to invoke the power under Section 482 Cr.P.C. to quash the order dated 05.04.2017 for forwarding the application filed by the respondent herein carrying allegations qua the appellant for investigation under Section 156(3), Cr.P.C., the consequential registration of the F.I.R. and the investigation pursuant thereto qua the appellant, in the facts and circumstances of the case and in view of the settled position in the matter of exercise of inherent powers under Section 482, Cr.P.C.

Treatment of the Issue by the Court:

Authorities

The Supreme Court relied on the following authorities:

Cases:

• Paramjeet Batra v. State of Uttarakhand & Ors. [ (2013) 11 SCC 673 ] : The Supreme Court of India held that the High Court should not hesitate to quash criminal proceedings to prevent abuse of process of the court when a dispute is essentially of a civil nature and a civil remedy is available.
• Vesa Holdings Private Limited and Anr. v. State of Kerala and Ors. [ (2015) 8 SCC 293 ] : The Supreme Court of India held that criminal proceedings should not be encouraged when it is found to be mala fide or otherwise an abuse of the process of the court.
• Kapil Aggarwal and Ors. v. Sanjay Sharma and Ors. [ (2021) 5 SCC 524 ] : The Supreme Court of India held that Section 482 is designed to ensure that criminal proceedings are not permitted to generate into weapons of harassment.
• State of Haryana v. Bhajan Lal [ AIR 1992 SC 604 ] : The Supreme Court of India laid down the principles for quashing an FIR, including cases where the allegations do not constitute an offense or are inherently improbable.
• Neeharika Infrastructure Pvt. Ltd. v. State of Maharashtra and Others [ 2021 SCC OnLine SC 315 ] : The Supreme Court of India outlined the principles for exercising the power under Section 482 Cr.P.C., emphasizing the need for caution and the circumstances under which an FIR can be quashed.

Legal Provisions:

• Section 482 of the Code of Criminal Procedure, 1973 (Cr.P.C.): Deals with the inherent powers of the High Court to prevent abuse of process or secure justice.
• Section 156(3) of the Cr.P.C.: Empowers a Magistrate to order a police investigation.
• Sections 323, 384, 406, 423, 467, 468, 420, and 120B of the Indian Penal Code (I.P.C.): Defines the offenses of causing hurt, extortion, criminal breach of trust, fraudulent execution of a deed of transfer, forgery, cheating, and criminal conspiracy.

Authority Consideration Table

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• Paramjeet Batra v. State of Uttarakhand & Ors. [ (2013) 11 SCC 673 ] :* The Court followed this authority, emphasizing that when a dispute is essentially civil and a civil remedy is available, criminal proceedings should be quashed to prevent abuse of process.
• Vesa Holdings Private Limited and Anr. v. State of Kerala and Ors. [ (2015) 8 SCC 293 ] :* The Court relied on this case to support its view that criminal proceedings should not be encouraged when they are mala fide or an abuse of the process of the court.
• Kapil Aggarwal and Ors. v. Sanjay Sharma and Ors. [ (2021) 5 SCC 524 ] :* The Court cited this case to reinforce that Section 482 of the Cr.P.C. is intended to prevent criminal proceedings from becoming tools of harassment.
• State of Haryana v. Bhajan Lal [ AIR 1992 SC 604 ] :* The Court applied the principles laid down in this case for quashing an FIR, particularly when the allegations do not constitute an offense or are inherently improbable.
• Neeharika Infrastructure Pvt. Ltd. v. State of Maharashtra and Others [ 2021 SCC OnLine SC 315 ] :* The Court used the principles outlined in this case to guide its decision on when to exercise its power under Section 482 Cr.P.C. to quash an FIR.

What weighed in the mind of the Court?

The Supreme Court’s decision was heavily influenced by the fact that the core dispute was civil in nature, and the criminal proceedings were an attempt to misuse the legal process. The Court emphasized the importance of preventing the abuse of criminal proceedings for settling civil disputes. The concealment of the pending civil suit by the respondent also weighed heavily on the Court’s decision.

The Court’s reasoning was based on the application of established legal principles to the specific facts of the case. The Court found that the allegations were vague and lacked the essential ingredients to constitute the alleged offenses. Additionally, the Court considered the fact that the respondent had already pursued a civil remedy for the same dispute, which further supported the conclusion that the criminal proceedings were an abuse of process.

Logical Reasoning

Key Takeaways

• Criminal proceedings should not be used to settle civil disputes.
• Courts should be cautious in allowing criminal investigations when the core issue is civil in nature.
• Concealment of material facts, such as the pendency of a civil suit, can be a ground for quashing criminal proceedings.
• Vague and non-specific allegations are not sufficient to initiate criminal proceedings.
• The power under Section 482 of the Cr.P.C. can be used to prevent the abuse of the legal process.

Directions

The Supreme Court quashed the FIR No.189 of 2017 dated 11.04.2017 registered at Madhyamgram Police Station against the appellants and all further proceedings based on the same.

Development of Law

The ratio decidendi of this case is that criminal proceedings should not be used as a tool to settle civil disputes. The Supreme Court reaffirmed the principle that when a dispute is essentially civil and a civil remedy is available, criminal proceedings should be quashed to prevent abuse of process. The Court also highlighted that concealment of material facts, like the pendency of a civil suit, can be a ground for quashing criminal proceedings. This judgment reinforces the need for a clear distinction between civil and criminal matters and ensures that the criminal justice system is not misused for settling civil disputes.

Conclusion

In conclusion, the Supreme Court allowed the appeal by Usha Chakraborty and Ashoka Chakraborty, quashing the FIR and all related proceedings. The Court emphasized that the criminal proceedings were an abuse of process, as the core dispute was civil in nature and the respondent had concealed the pendency of a civil suit on the same matter. This judgment serves as a reminder that the criminal justice system should not be used to harass individuals or to resolve disputes that are essentially civil.