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Shrichand Rajaram Kukreja v. The State of Maharashtra

Criminal Appeal · 2025 INSC 794Decided 14 May 2025
Criminal Appeal (arising out of SLP (Crl.) No. 9857 of 2018, with connected SLP (Crl.) No. 10444 of 2018)
Justice Vikram Nath · Justice Sandeep Mehta

Background

The appellants ran Bharat Udyog Limited (BUL), which had won a government tender to build a sewerage water filter plant and sub-contracted portions of the work down a chain, eventually to the complainant's firm, Sai Group. The complainant alleged that after doing substantial work he was left with several crores of dues unpaid, was induced with false assurances to keep working, and that the accused fraudulently claimed his employees as their own to the authorities. An FIR alleging cheating and forgery was registered in 2015, and after the Bombay High Court refused to quash it, the accused appealed to the Supreme Court.

Decision Breakdown

The Supreme Court found that even taking the complaint entirely at face value, it described a dispute over unpaid contractual dues, a civil/commercial matter, not a criminal offence; the complainant himself admitted receiving substantial part-payment, which is inconsistent with cheating from the outset. The Court criticized the High Court for basing its refusal to quash on "sheer conjecture" about wider financial wrongdoing that the actual police investigation (spanning almost ten years) never substantiated. It also noted the forgery allegation against two engineers' signatures was inconclusive per the handwriting expert's report. Citing its own precedent (Inder Mohan Goswami), the Court held that criminal process cannot be used as a debt-recovery tool for what is essentially a commercial dispute, and quashed both the FIR and the resulting chargesheet, while leaving open the department's ability to investigate any separate financial irregularities that surface independently.

Lesson Learnt

Filing a police complaint or FIR is not a substitute for a civil lawsuit to recover unpaid contractual dues. Courts will step in to quash criminal proceedings that are, in substance, being used to pressure the other side in what is really a business or payment dispute.

Official source (sci.gov.in)View Judgment (PDF)

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