Jammu and Kashmir High Court Quashes FIR in Alleged Cheating Case Over Dubai Property Transaction

The court ruled the dispute as civil in nature, emphasizing the absence of criminal intent in the transaction between the involved parties.

In a significant judgment, the Jammu and Kashmir High Court has quashed an FIR filed against Mukhtar Ahmad Dar under Section 318(4) of the Bharatiya Nyaya Sanhita, 2023, for allegedly cheating in a property transaction involving two commercial shops in Dubai. The court, presided by Justice Sanjay Dhar, concluded that the case was purely civil and lacked criminal intent, thereby preventing the misuse of legal processes.

The FIR, registered at Police Station Budgam, stemmed from a complaint by Anil Bhagwandas Karamchandani, a businessman from Mumbai, who alleged that Dar induced him to pay Rs. 5 crores as part of a Rs. 20 crore deal for two shops in Dubai. However, it was claimed that Dar sold the properties to a third party and the security cheque provided by him was dishonored due to insufficient funds.

During the proceedings, the court examined whether the transaction constituted cheating under the Bharatiya Nyaya Sanhita, 2023. The judgment underscored that for an act to qualify as cheating, fraudulent or dishonest intent must be present at the inception of the transaction. Justice Dhar noted that the complaint and supporting documents did not demonstrate such intent at the time the deal was purportedly made.

The court also referenced an acknowledgment document from Dubai, which indicated a loan agreement rather than a property sale, further confirming the civil nature of the dispute. The judgment reflected on the Supreme Court's stance against converting civil matters into criminal cases, as seen in precedents like M/s. Indian Oil Corporation v. M/S NEPC India Ltd.

Emphasizing the need to prevent legal system abuse, Justice Dhar stated, "The impugned FIR is an attempt to find a shortcut for recovery of dues under the guise of criminal proceedings."

The court's decision highlights the judiciary's role in distinguishing between civil and criminal matters, ensuring that the legal process is not misused for personal vendettas or to exert undue pressure on parties involved in commercial disputes.

Statutory provision(s): Bharatiya Nagarik Suraksha Sanhita, 2023 Section 528, Bharatiya Nyaya Sanhita, 2023 Section 318(1), Bharatiya Nyaya Sanhita, 2023 Section 318(4), Bharatiya Nyaya Sanhita, 2023 Section 528

Mukhtar Ahmad Dar v. UT of J&K, (Jammu and Kashmir)(Srinagar) : Law Finder Doc Id # 2805978