Case Note & Summary
The matter arose from a property transaction involving land Survey No. 132/2 at Solapur. Respondent No.2 (first informant) and his brother were the owners. An Isar Pavati (Memorandum of Understanding) was executed with Accused No.1 on 22.04.2014 for a total amount of Rs.2,84,00,000. On 07.05.2014, a registered sale-deed was executed between the informant, his brother, and the applicants (purchasers) in respect of the same property, fixing the consideration at Rs.70,00,000, which was acknowledged as received. On the same day, a separate unregistered agreement was entered into between the informant, his brother, and Accused No.1, containing terms allegedly contrary to the sale-deed. Later, on 09.10.2016, a Paratfed (repayment) agreement was executed between the informant, his brother, and Accused No.1, acknowledging that out of Rs.2,84,00,000, only Rs.1,17,00,000 was paid, leaving a balance of Rs.1,67,00,000. Based on these, the informant lodged a complaint alleging cheating under Section 420 IPC. The applicants were not parties to the unregistered agreement or the repayment agreement. They filed an application for discharge under Section 227 CrPC before the Chief Judicial Magistrate, Solapur, in Regular Criminal Case No.1235 of 2018, which was rejected on 01.01.2025. Their revision application before the Sessions Judge, Solapur, was also dismissed on 23.07.2025. Consequently, they invoked the inherent jurisdiction of the High Court under Section 482 CrPC. The core legal issue was whether criminal proceedings could be maintained against the applicants in the face of the registered sale-deed which conclusively established a civil transaction. The applicants contended that the registered deed proved full payment and transfer of title, and that the unregistered agreements, to which they were not parties, could not bind them. They argued that the dispute was essentially civil and that the criminal proceedings were an abuse of process. The respondent no.2 and the State, however, submitted that the separate agreements and the re-payment arrangement indicated cheating and criminal conspiracy, and that the concurrent findings of the lower courts should not be interfered with under Section 482 CrPC. The High Court, per Sandesh D. Patil, J., examined the charge-sheet and the sale-deed. It noted that the sale-deed recited a consideration of Rs.70,00,000 and contained a receipt clause acknowledging payment. The court held that the informant could not contradict the terms of the registered document by relying on an unregistered agreement, especially when the applicants were not parties to it. Relying on the Supreme Court decision in S. Sakthivel (Dead) By Lrs. v. M.Venugopal Pillai And Ors., AIR 2000 SC 2633, which held that the terms of a registered agreement can be altered only by another registered agreement, the court found that the lower courts had overlooked this settled principle. The court concluded that the transaction was civil in nature, and no ingredients of the offence of cheating under Section 420 IPC were made out against the purchasers. The criminal proceedings were thus held to be an abuse of process. Accordingly, the High Court allowed the criminal application, quashed the impugned orders, and directed the discharge of the applicants.
Headnote
A) Criminal Procedure - Discharge and Quashing - Sections 227 and 482, Code of Criminal Procedure, 1973 - Registered sale-deed prevails over unregistered agreement; terms of registered document can only be altered by another registered document (S. Sakthivel v. M. Venugopal Pillai, AIR 2000 SC 2633) - Applicants purchased property under registered sale-deed, were not parties to unregistered agreement; dispute essentially civil - Held that concurrent findings rejecting discharge ignored settled law; criminal proceedings amounted to abuse of process and were quashed (Paras 15-19). B) Criminal Law - Cheating and Criminal Conspiracy - Sections 420 and 34, Indian Penal Code, 1860 - Ingredients of cheating not established when complainant acknowledged receipt of full consideration in registered sale-deed and property title transferred - Held that no offence made out; civil remedy appropriate (Paras 13, 15, 18).
Issue of Consideration
Whether the applicants are entitled to discharge under Section 227 CrPC when the registered sale-deed conclusively establishes the transaction as civil and the applicants were not parties to the unregistered agreement, and whether the concurrent orders of the lower courts rejecting discharge can be sustained under Section 482 CrPC
Final Decision
The High Court allowed the criminal application, quashed the orders of the Chief Judicial Magistrate and Sessions Judge, and directed the discharge of the applicants from Regular Criminal Case No. 1235 of 2018, holding that the dispute was civil in nature and the criminal proceedings were an abuse of process.
Law Points
- registered document prevails over unregistered agreement
- terms of registered document can be altered only by another registered document
- Section 227 CrPC discharge criteria
- Section 482 CrPC quashing for abuse of process
- ingredients of cheating under Section 420 IPC
- civil dispute cannot be criminalised
- concurrent findings may be interfered if contrary to law
- S. Sakthivel v. M.Venugopal Pillai followed
