Mohammad Firoz Islam Shaikh And Anr vs. The State Of Maharashtra And Ors

Held

The Court held that it could quash criminal proceedings under its inherent powers when parties settle their private disputes, especially when the lis is purely civil and commercial, and the offence is not heinous or does not impact society at large. The Court reasoned that criminal law should not be used as a bargaining chip or a tool for private settlements after draining state and judicial resources, nor as a recovery mechanism. The Court invoked Section 482 of the Criminal Procedure Code, 1973, and Section 528 of BNSS, citing the Supreme Court's guidelines in State of Haryana vs. Bhajan Lal. The Court found that the present case involved a settlement of a commercial dispute where the amounts were returned, and the complainant consented to quashing. Consequently, the Court allowed the petitions to quash the FIRs and criminal proceedings. As a condition for consent quashing, the Court imposed costs of Rs. 10,000/- per petition (totaling Rs. 30,000/-) on the petitioners, to be paid to the A.K. Munshi Yojana, a charitable trust, to deter vexatious litigation and compensate for the wastage of public resources and judicial time.

Facts

Three criminal writ petitions were filed before the Bombay High Court. The petitioners in these petitions were different, but the complainant was the same across all three. The disputes stemmed from the redirection of GST amounts concerning the complainant's three distinct businesses. The core issue in all petitions related to GST amounts, but the parties had since reconciled their differences, and the amounts in dispute had been returned. The parties jointly requested the court to quash the complaints by consent, supported by consent affidavits from the complainant affirming receipt of all GST dues and a desire to proceed without the burden of criminal prosecution. Criminal Writ Petition No. 4057 of 2022 was initially dismissed for default but was restored by the court.

Key Issues

1. Whether the High Court, in exercise of its inherent powers under Section 482 of the Criminal Procedure Code, 1973 (and Section 528 of BNSS), can quash criminal proceedings based on a settlement between the parties, particularly when the dispute is primarily civil and commercial in nature and the offence is not heinous or does not have significant societal implications? Petitioner's contention: The parties have reconciled their differences, the disputed GST amounts have been returned, and the complainant has provided consent for quashing the proceedings. They seek to be freed from the ignominy of criminal prosecution to pursue their businesses and future lives without hindrance. They rely on the principle that criminal law should not be used as a tool for private settlements in civil disputes. Revenue/State's contention: Not recorded in the judgment.