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Thursday, November 14, 2013


Whether breach of contract of an agreement for sale would constitute an offence under section 406 or 420 of the Indian Penal Code.

The Hon’ble Supreme Court in Dalip Kaur and Ors. Vs.  Jagnar Singh and Anr., observed that, if the dispute between the parties is a civil dispute resulting from a breach of contract by non-refunding the amount of advance then same would not constitute an offence of cheating.

The High Court would exercise its inherent jurisdiction only when one or the other propositions of law, as laid down in R. Kalyani Vs.  Janak C. Mehta and Ors., is attracted, which are as under:

(1)  The High Court ordinarily would not exercise its inherent jurisdiction to quash a criminal proceeding and, in particular, a First Information Report unless the allegations contained therein, even if given face value and taken to be correct in their entirety, disclosed no cognizable offence.

(2)  For the said purpose, the Court, save and except in very exceptional circumstances, would not look to any document relied upon by the defence.

(3)  Such a power should be exercised very sparingly. If the allegations made in the FIR disclose commission of an offence, the court shall not go beyond the same and pass an order in favour of the accused to hold absence of any mens rea or actus reus.

(4)  If the allegation discloses a civil dispute, the same by itself may not be a ground to hold that the criminal proceedings should not be allowed to continue.

Prepared by: S. Hemanth
Advocate at Hemanth & Associates