Supreme Court Quashes Criminal Proceedings in Property Dispute: Upholds Civil Nature of Allegations


Case Title: Mala Choudhary & Anr. v. State of Telangana & Anr.

Citation: 2025 INSC 870

Date of Judgment: 18 July 2025

Coram: Hon’ble Justices Vikram Nath and Sandeep Mehta

Overview

In a significant ruling safeguarding the abuse of criminal machinery, the Hon’ble Supreme Court quashed an FIR and criminal case filed against a 70-year-old widow and her daughter in a real estate transaction dispute. The Court strongly condemned the misuse of the criminal process for what was essentially a civil disagreement and imposed exemplary costs of ₹10,00,000 on the complainant.

Background

The appellants, Mala Choudhary (70) and her daughter, residents of New Delhi, were implicated in FIR No. 771/2020 registered at PS Gachibowli, Telangana. The case stemmed from an oral agreement to sell a plot of land measuring 500 sq. yards situated in Gachibowli, allegedly entered into with the complainant, an agent of Sandhya Constructions & Estates Pvt. Ltd.

The complainant alleged that he paid ₹4.05 crore via cheques and RTGS, and an additional ₹75 lakhs in cash, on the assurance of a sale. However, the appellants denied receiving any cash amount and stated the transaction was conditional on full payment—conditions the complainant failed to meet. Despite the civil nature of the disagreement, criminal proceedings were initiated, including arrest and eight-day judicial custody of the elderly appellant.

High Court’s Disposition

The Telangana High Court dismissed the appellants’ quashing petition under Section 482 CrPC in a cryptic manner, without examining the merits of the case, merely directing the trial court to consider a Section 205 CrPC application.

Supreme Court’s Findings

The Supreme Court found the High Court’s approach to be “laconic and perfunctory” and noted several discrepancies in the FIR and the complainant’s civil suit for specific performance. Notably:

• The FIR exaggerated facts, mentioning additional properties and parties not involved in the civil suit.
• The complainant already had a pending civil suit (O.S. No. 95 of 2021) for specific performance.
• The appellants had offered to return the amount received through banking channels.
• The complainant refused the refund and insisted on interest, despite having subjected the appellants to prolonged litigation.

Key Observations

“This is a classic case of misuse of the criminal justice system to exert pressure in a civil dispute.”

“The arrest and custodial detention of a 70-year-old widow, wife of a retired Army Major General, reveals the undue influence exercised by the complainant.”

The Court unequivocally held that the FIR was registered in “gross abuse of the process of law” and that the complainant should have pursued civil remedies instead.

Final Directions

• FIR and all proceedings pursuant to it were quashed.
• ₹10 lakh cost imposed on the complainant for malicious prosecution.
• The appellants were granted police protection whenever visiting Telangana for property matters.
• The complainant’s refusal to accept refund without interest was directed to be recorded in the civil suit proceedings.

Lex Maven Insights

This judgment underscores the Supreme Court’s firm stance against criminalizing civil transactions and highlights the importance of protecting individual liberty, especially of senior citizens, from oppressive litigation.

At Lex Maven, we are committed to ensuring that the law is not weaponized to harass innocent parties. This case serves as a reminder that civil remedies must be pursued through appropriate forums, and criminal law should not be misused as a tool of coercion.