Sreekanth Reddy vs. The State Of Tamil Nadu

Held

The Court held that the dispute between the parties was purely civil in nature and had been given a criminal colour. The Court found that a sum of money was due and payable to the second respondent, and instead of initiating civil proceedings for recovery, the second respondent chose to approach the police. The Court noted the delay in registering the FIR after the complaint was filed and the subsequent arrest of A2 without issuing a summons under Section 41A of the CrPC, deeming it inappropriate for a business transaction dispute. The continuation of the criminal case was considered an abuse of the process of law. Therefore, the FIR in Crime No. 13 of 2023 was quashed. The Court clarified that this order would not prevent the second respondent from pursuing their remedy for recovery of the amount before the appropriate forum. The writ petition and the criminal original petition were allowed.

Facts

The petitioners, identified as A2 and A4 in FIR No. 13 of 2023, sought to quash the FIR registered by the Deputy Superintendent of Police, District Crime Branch, Karur. The complaint was filed by the Director of ABC Construction, alleging that the petitioners' company (SPCL) defaulted on payments amounting to Rs. 57 lakhs for manpower supply for airport construction in Andaman. The defacto complainant stated that this non-payment led to workmen being stranded without salary and that the complainant had to incur significant GST expenses due to the default. The petitioners argued that the dispute was purely commercial, that their contractual obligation was with CCPL, not directly with the defacto complainant, and that any grievance should be addressed through civil proceedings. They also raised concerns about the delay in FIR registration and the circumstances of an arrest.

Key Issues

1. Whether the FIR registered in Crime No. 13 of 2023 for offences under Sections 120(b), 406, and 420 of the Indian Penal Code, 1860, is liable to be quashed, considering the nature of the dispute. Petitioner's Arguments: The petitioners contended that the dispute was purely civil and commercial in nature, involving contractual obligations and payment of money. They argued that the defacto complainant should have pursued civil remedies like a suit for recovery of money instead of filing a criminal complaint. They also raised procedural irregularities, including the delay in registering the FIR and the circumstances of an arrest without proper notice under Section 41A of the CrPC, suggesting an abuse of process. Revenue's Arguments: The judgment does not explicitly record arguments presented by the revenue or the State. It notes that the respondent police were directed to proceed with the investigation and not file a charge sheet until further orders.