Inder Chand Bagri Vs Jagadish Prasad Bagri & Another (Supreme Court of India)
No Cheating, No Trust Breach-Just a Business Breakup- Partnership Fallout Isn’t Penal- Dispute Found Purely Civil: Criminal Case for Cheating & Breach of Trust Quashed- SC Sends Civil Dispute Back to Civil Court
This appeal arose from the Gauhati High Court’s refusal to quash criminal proceedings initiated against the appellant u/s 406, 420 & 120B IPC. The dispute stemmed from a partnership formed in 1976 for construction & leasing of godowns on land belonging to the appellant. A supplementary agreement in 1981 clearly recorded that upon expiry of the FCI lease in 1993, the land along with constructions would revert exclusively to the appellant. The firm was eventually dissolved in 1997 with all assets & liabilities mutually agreed to be transferred to the appellant as sole proprietor.
Despite having himself filed a dissolution suit on the same partnership & having obtained an ex parte preliminary decree declaring dissolution, the complainant-respondent No.1-later filed a civil suit in 2012 challenging the appellant’s sale of the disputed property to his nephew in 2011. Thereafter, he also filed a criminal complaint in 2013 alleging cheating, breach of trust & conspiracy. Cognizance was taken by the Magistrate in 2014. The High Court quashed proceedings against accused No.2 (nephew) but refused to quash them against the appellant.
