'How Many Times High Courts Are To Be Reminded?' : Supreme Court Anguished At HC Not Quashing FIR Over Civil Dispute

The Supreme Court criticised the Allahabad High Court for directing a film producer to pay Rs. 25 lakh to a complainant as a precondition for referring a dispute to mediation while dealing with a plea for quashing of a cheating FIR, despite the dispute being civil in nature.

A bench of Justice J.B. Pardiwala and Justice R. Mahadevan observed that the High Court seems to have forgotten well-settled principles in the case of State of Haryana & Others v. Bhajan Lal & Others on quashing of criminal proceedings.

“We are quite disturbed by the manner in which the High Court has passed the impugned order. The High Court first directed the appellant to pay Rs.25,00,000/- to the Respondent No.4 and thereafter directed him to appear before the Mediation and Conciliation Centre for the purpose of settlement. That's not what is expected of a High Court to do in a Writ Petition filed under Article 226 of the Constitution or a miscellaneous application filed under Section 482 of the Code of Criminal Procedure, 1973 for quashing of FIR or any other criminal proceedings. What is expected of the High Court is to look into the averments and the allegations levelled in the FIR along with the other material on record, if any”, the Court observed.

The Court quashed a cheating FIR filed against Shailesh Kumar Singh alias Shailesh R. Singh, co-founder and production head of Karma Media and Entertainment LLP. The Supreme Court said the High Court failed to examine whether the FIR disclosed any criminal offence and instead turned the proceedings into a recovery mechanism.

“How many times the High Courts are to be reminded that to constitute an offence of cheating, there has to be something more than prima facie on record to indicate that the intention of the accused was to cheat the complainant right from the inception. The plain reading of the FIR does not disclose any element of criminality”, the Court observed.

The Court allowed Singh's appeal against the High Court's March 7, 2025 order, calling it a “disturbing” example of how the writ jurisdiction under Article 226 was misapplied to help a complainant recover money by using criminal proceedings.

The FIR, registered on January 9, 2025 at Police Station Hariparwat in Agra, alleged offences under Sections 60(b), 316(2) and 318(2) of the Bharatiya Nyaya Sanhita, 2023. The complainant was the promoter of Polaroid Media, a company engaged in financing media projects. He accused Singh of cheating and criminal breach of trust in connection with an oral business agreement between their companies.

In a writ petition before the High Court, Singh sought quashing of the FIR, submitting that it was a civil commercial dispute being given a criminal colour, and arguing that no criminal offence was made out.

Instead of deciding the petition on its merits, the High Court directed Singh to pay Rs 25 lakh to the complainant and appear before the Mediation and Conciliation Centre of the Court. The order stated that the amount would be handed over to the complainant on April 8, 2025 and that a mediation fee of Rs 5,000 should also be paid. The Court restrained Singh's arrest in the meantime but made the relief conditional on his compliance.

The Supreme Court criticised this approach. It observed that the High Court should have either quashed the FIR if no offence was disclosed, or rejected the plea if it found otherwise, and it is for the Civil Court or Commercial Court to look into any suit that may be filed for recovery of money.

It said, “We fail to understand, why the High Court should undertake such exercise. The High Court may either allow the petition saying that no offence is disclosed or may reject the petition saying that no case for quashing is made out. Why should the High Court make an attempt to help the complainant to recover the amount due and payable by the accused.”

The Court emphasised that even if Singh owed money to the complainant under an oral agreement, that alone did not constitute the offence of cheating unless there was intent to cheat from the beginning.

The Court noted that the complainant had not filed any civil suit or initiated other legal proceedings for recovery. It added, “Money cannot be recovered, more particularly, in a civil dispute between the parties by filing a First Information Report and seeking the help of the Police.”

The Court held that the FIR was an abuse of the criminal process and quashed it. However, the Court clarified that the complainant was free to pursue recovery proceedings in an appropriate civil forum.

Advocate Sana Raees Khan appeared for Singh, Advocate Anand Mishra for the complainant, and Advocate Shaurya Krishna for the State of Uttar Pradesh.

Case No. – Criminal Appeal No. 2963/2025

Case Title – Shailesh Kumar Singh Alias Shailesh R. Singh v. State of Uttar Pradesh & Ors

Citation : 2025 LiveLaw (SC) 726

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