The Supreme Court of India has ruled that the mere pendency of civil proceedings cannot be a ground to quash a criminal complaint involving allegations of fraud and misrepresentation. The Court set aside a Delhi High Court order that had quashed FIR No. 94/2022 registered against Vikramjit Singh and Maheep Singh, and revived the investigation in a case relating to the sale of a high-value property in New Delhi.
The judgment was delivered by a Bench comprising Justice Dipankar Datta and Justice Manmohan in Punit Beriwala vs. State of NCT of Delhi & Others, Criminal Appeal No. 1834 of 2025 (arising out of SLP (Crl.) No. 11042 of 2022).
Background of the Case
The dispute arises from a Receipt-cum-Agreement to Sell dated 12 April 2004, allegedly executed by Bhai Manjit Singh as Karta of his Hindu Undivided Family (HUF), along with Vikramjit Singh and Maheep Singh, in favour of appellant Punit Beriwala for the sale of property at 28-A, Prithvi Raj Road, New Delhi, for ₹28 crores. Beriwala claimed to have paid ₹1.64 crore over several months and alleged that the agreement was accompanied by false assurances and misrepresentation.
Later, the appellant discovered that the property had been mortgaged and eventually sold to J.K. Paper Limited in December 2021. In response, Beriwala filed a civil suit for specific performance and subsequently a criminal complaint with the Economic Offences Wing, leading to registration of FIR No. 94/2022 under Sections 467, 468, 471, 420, and 120B IPC.
The Delhi High Court quashed the FIR against Vikramjit Singh and Maheep Singh, accepting their plea that the matter was civil in nature and noting the delay in registration of the FIR.
Supreme Court’s Observations
The Supreme Court found the High Court’s reasoning to be flawed on several counts:
“It is trite law that mere institution of civil proceedings is not a ground for quashing the FIR or to hold that the dispute is merely a civil dispute,” the Court observed, citing precedents including Trisuns Chemicals v. Rajesh Aggarwal (1999) 8 SCC 686 and Syed Aksari Hadi Ali Augustine Imam v. State (Delhi Admin.) (2009) 5 SCC 528.
It emphasized that a civil remedy does not preclude criminal liability when the complaint discloses prima facie evidence of cognizable offences.
The Court also reiterated the principles laid down in Neeharika Infrastructure v. State of Maharashtra (2021) 19 SCC 401, stating:
“While exercising this power [of quashing], the Court must believe the averments and allegations in the complaint to be true and correct.”
Findings on Misrepresentation
The Court held that if the allegations in the complaint are to be believed, then the FIR discloses a case of deliberate misrepresentation:
“Vikramjit Singh and Maheep Singh, despite knowing that Bhai Manjit Singh was not the Karta of the HUF, allowed him to represent himself as such, thereby causing the appellant to part with a large sum of money.”
It noted that Vikramjit Singh was, in fact, the Karta of the HUF since March 2000, as reflected in the sale deed dated 2 December 2021. This fact was allegedly concealed during the 2004 transaction.
Delay Not a Justifiable Ground
Rejecting the High Court’s reliance on delay in FIR registration, the Supreme Court held:
“Delay in registration of FIR for offences punishable with imprisonment of more than three years cannot be the basis of interdicting a criminal investigation.”
The Court accepted that the appellant became aware of the full extent of the alleged fraud only in December 2021 when he obtained a copy of the sale deed, and filed his complaint promptly on 12 January 2022.
Cross-FIRs and the Need for Holistic Investigation
The Court also took note of the fact that the accused had filed a cross-FIR against the appellant after the FIR in question. It underscored the need for comprehensive investigation in cases involving such cross-allegations.
“In view of cross-FIRs, the investigating authority will conclude that either the receipts in favour of the Appellant are forged and fabricated or that the receipts are genuine. The complicity of Respondent Nos. 2 and 3 can only be ascertained once the investigation is permitted to reach its logical conclusion.”
Conclusion
The Court concluded that the FIR disclosed cognizable offences and that the High Court erred in quashing the complaint prematurely. Accordingly, it restored FIR No. 94/2022 and directed that investigation proceed against Vikramjit Singh and Maheep Singh. It clarified that its findings are limited to the context of quashing and will not bind the trial court.
“The impugned judgment and order dated 17th October 2022 passed by the learned Single Judge… is set aside and FIR No.94/2022… is revived.”
