Crl.OP(MD)Nos.873 and 250 of 2026

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT

RESERVED ON : 27.02.2026

PRONOUNCED ON : 01.06.2026

CORAM

THE HONOURABLE MRS.JUSTICE L.VICTORIA GOWRI

Crl.O.P.(MD).Nos.873 and 250 of 2026

and

Crl.M.P.(MD)Nos.949 and 254 of 2026

Crl.O.P.(MD).No.873 of 2026

1. R.Sakthivel Raja

2. S.Manikandan ... Petitioner/Accused

Vs.

1. The State of Tamilnadu,

Rep. by the Inspector of Police,

CCB, Madurai City,

Crime No. 74 of 2025

.... Respondent / Complainant

2. Rajendra Mulani

..... Respondent /

Defacto Complainant

Prayer : Criminal Original Petition is filed under Section 528 of

BNSS, 2023, to call for the record pertaining to the Impugned FIR in

Crime no.74 of 2025 dated 19.12.2025 on the file of the respondent

Police CCB, Madurai City and quash the same as illegal so far as the

petitioners is concerned.

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Crl.OP(MD)Nos.873 and 250 of 2026

For Petitioners: Mr.C.Muthusaravanan

For R-1 : Mr.S.Ravi,

Additional Public Prosecutor

For R-2 : Mr.S.Chandrasekar

Crl.O.P.(MD).No. 250 of 2026

1. N. Visalakshi

2. N. Meenakshi

... Petitioners / A1 & A4

Vs.

1. The State represented by

The Inspector of Police,

CCB-III, Madurai City.

2. Rajendra Mulani,

Authorised Representative,

M/s.Khimji Poonja & Co.,

K.P.House, Meadow Street,

Mumbai, Maharashtra.

... Respondents

Prayer : Criminal Original Petition is filed under Section 528 of

BNSS, 2023, to call for the records of the FIR in Crime no.74 of 2025

dated 19.12.2025 on the file of the 1

st

respondent police and quash

the same in so far as the petitioner are concerned.

For Petitioner: Mr.G.Prabhu Rajadurai,

For Mr.I.Robert Chandra Kumar

For R-1 : Mr.S.Ravi,

Additional Public Prosecutor

For R-2 : Mr.S.Chandrasekaran

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Crl.OP(MD)Nos.873 and 250 of 2026

COMMON ORDER

These Criminal Original Petitions have been filed invoking the

inherent jurisdiction of this Court under Section 528 of the

Bharatiya Nagarik Suraksha Sanhita, 2023, seeking quashment of

the First Information Report in Crime No.74 of 2025 dated

19.12.2025 registered on the file of the first respondent police for the

alleged offences under Sections 296(b), 318(3), 321 and 351(2) of the

Bharatiya Nyaya Sanhita, 2023.

2. Since both the petitions arise out of the very same FIR,

involve interconnected allegations and common questions of fact and

law, they are taken up together and disposed of by this common

order.

3. The case presents a familiar yet legally delicate situation

where a long-standing commercial dispute, coupled with competing

claims over immovable properties allegedly offered as collateral

security, has eventually culminated in criminal prosecution after

more than two decades from the foundational transaction. The

central issue before this Court is whether the allegations, even if

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Crl.OP(MD)Nos.873 and 250 of 2026

accepted in their entirety, disclose the commission of cognizable

criminal offences warranting investigation, or whether the criminal

law has been invoked as a pressure mechanism in aid of a stale civil

claim.

Case of the prosecution:

4. The prosecution case, in brief, is that the second respondent

firm, namely M/s.Khimji Poonja & Co., Mumbai, was engaged in the

business of supply and sale of cotton and had commercial dealings

with M/s.Shree Visalakshi Mills Private Limited, Madurai, from the

year 1995 onwards.

5. According to the de facto complainant, the mill defaulted in

payment of amounts due towards supply of cotton. Consequently, on

10.08.2000, an agreement was entered into acknowledging the

outstanding dues and promising repayment with interest. Thereafter,

on 29.04.2002, certain persons connected with the mill allegedly

executed a promissory note treating the liability as their personal

liability.

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Crl.OP(MD)Nos.873 and 250 of 2026

6. The further allegation is that on 02.05.2002, title deeds

relating to approximately 35.37 acres of lands situated in

Kulasekarankottai Village, Vadipatti Taluk, Madurai District, were

deposited by way of collateral security and mortgage by deposit of

title deeds in favour of the de facto complainant firm. The

complainant claims continued custody of the original title deeds.

7. It is the further case of the prosecution that during October

2024, the accused persons sold an extent of 2 acres and 42 cents

from the aforesaid lands to A-9, namely Sakthivel Raja. It is alleged

that such sale was preceded by a false police complaint before

Vadipatti Police Station alleging loss of original documents and

issuance of a newspaper publication suppressing the fact that the

original documents were allegedly lying with the complainant firm.

8. The prosecution further alleges that the accused

intentionally created false records, dishonestly concealed the

subsisting mortgage security and alienated the property in order to

defeat the rights of the complainant and thereby caused wrongful

loss to the complainant and wrongful gain to themselves.

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Crl.OP(MD)Nos.873 and 250 of 2026

9. It is also alleged that on 06.09.2025, when the

representative of the complainant firm visited Madurai and met the

accused persons, they abused him in filthy language and criminally

intimidated him with threats to his life. On the basis of the said

complaint, the impugned FIR came to be registered for offences

under Sections 296(b), 318(3), 321 and 351(2) BNS.

Grounds for quash:

10. The petitioners therein contend that A-9 is a bona fide

purchaser for valuable consideration who purchased the property

only after conducting due diligence including verification of

encumbrance certificates, revenue records, legal opinion, public

notice and obtaining non-traceable certificate regarding original

documents. It is contended that the alleged mortgage or deposit of

title deeds was never reflected in any encumbrance certificate and

therefore the purchasers had absolutely no knowledge about any

alleged security interest claimed by the complainant.

11. The petitioners further contend that they were never

parties to the original commercial transaction, promissory note,

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mortgage arrangement or proceedings before the Debt Recovery

Tribunal and hence cannot be implicated merely because they

purchased a portion of the property.

12. The petitioners further contend that the dispute is purely

civil in nature relating to enforcement of a debt allegedly arising in

the year 2000/2002 and that the complainant is attempting to

convert a time-barred civil dispute into a criminal prosecution. It is

further contended that no ingredients of cheating, criminal breach of

trust, criminal intimidation or obscenity are made out against A-9

and A-10.

13. The petitioners therein contend that they are women aged

about 77 and 72 years respectively and had no role whatsoever in

the business dealings of the company. According to them, they were

neither signatories to the alleged promissory note nor executants of

the alleged deposit of title deeds and they were not concerned with

the alleged police complaint regarding missing documents or

publication in newspaper.

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14. It is their further case that the company itself had gone

into liquidation long back and substantial portions of the properties

had already been sold in DRT/SARFAESI proceedings many years

ago. The petitioners contend that the entire complaint is hopelessly

barred by limitation and that the complainant, having remained

silent for more than two decades, cannot now criminalise legal heirs

and family members. It is also contended that even assuming the

allegations to be true, the facts merely disclose a civil dispute

concerning enforceability of mortgage security and title rights.

Arguments on either side:

15. The learned counsels appearing for the petitioners

elaborately contended that the very foundation of the dispute is an

admitted commercial transaction relating to supply of cotton and

repayment of money. According to them, the dispute emanates from

a business arrangement dating back to the years 2000 and 2002 and

therefore lacks the essential ingredients of criminality. It was

submitted that the complainant himself admits execution of

promissory note and deposit of title deeds as collateral security.

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Hence, the relationship between parties was purely contractual and

commercial in nature.

16. The learned counsels would submit that the remedy, if any,

available to the complainant lies only before the competent civil

forum for enforcement of mortgage rights or recovery proceedings

and not through criminal prosecution. The learned counsels further

contended that dishonest intention at the inception of the

transaction is the sine qua non for attracting the offence of cheating.

In the present case, according to the petitioners, the very fact that

properties worth several crores were allegedly offered as collateral

security itself demonstrates absence of dishonest intention from

inception.

17. It was further argued that a mortgage by deposit of title

deeds does not create an absolute embargo against alienation of the

property and that at best the purchaser takes the property subject to

existing rights, if any. The learned counsels strongly relied upon the

enormous delay. According to them, the promissory note is of the

year 2002 and even assuming a valid mortgage existed, the

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complainant failed to take appropriate proceedings within the

limitation period prescribed under law.

18. The learned counsels would further submit that the

allegations under Sections 296(b) and 351(2) BNS are vague,

omnibus and bereft of particulars. No specific obscene words are

stated. No overt act constituting criminal intimidation has been

properly disclosed. The learned counsels also submitted that A-9 and

A-10 are bona fide purchasers and there are absolutely no

allegations demonstrating conspiracy or collusion on their part.

Reliance was placed upon the decisions of the Hon’ble Supreme

Court in Mohammed Ibrahim and others v. State of Bihar and

another

1

, Sheila Sebastian v. R. Jawaharaj

2

, Arshad Neyaz

Khan v. State of Jharkhand

3

and several judgments cautioning

against criminalisation of civil disputes.

19. Per contra, the learned counsel appearing for the de facto

complainant submitted that the case cannot be characterised as a

mere civil dispute since the allegations disclose deliberate acts of

1 (2009) 8 SCC 751

2AIR 2018 SC 2434

32025 SCC Online SC 2058

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deception and suppression. According to the complainant, despite

being fully aware that the original title deeds were deposited with the

complainant as collateral security, the accused falsely represented

before the police authorities that the documents were lost and

thereby obtained non-traceable certificates and duplicate records.

20. It was contended that the accused thereafter deliberately

alienated the secured property with dishonest intention to defeat the

complainant’s rights. The learned counsel further relied upon

statements allegedly made before the Debt Recovery Tribunal

acknowledging the mortgage arrangement and submitted that the

accused were fully aware of the complainant’s security interest.

21. It was argued that the issue is not merely about alienation

of property but about fraudulent concealment and creation of false

records. The learned Additional Public Prosecutor submitted that the

FIR clearly discloses cognizable offences and that at the stage of

investigation this Court ought not to conduct a mini-trial or

adjudicate disputed questions relating to validity of mortgage,

limitation or enforceability of security.

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22. Reliance was placed upon the judgment of the Hon’ble

Supreme Court in Neeharika Infrastructure Pvt. Ltd. v. State of

Maharashtra

4

to contend that quashing at FIR stage must be

exercised sparingly.

23. Heard the learned counsels on either side and carefully

perused the materials available on record.

Points for consideration:

24. In the light of the rival submissions, the following points

arise for consideration:

i. Whether the allegations in the impugned FIR, taken at face

value, disclose the ingredients of offences under Sections 296(b),

318(3), 321 and 351(2) BNS?

ii. Whether the dispute is predominantly civil and commercial

in nature?

iii. Whether continuation of the impugned criminal proceedings

would amount to abuse of process of law warranting interference

under Section 528 BNSS?

4 2021 SCC Online SC 315

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Crl.OP(MD)Nos.873 and 250 of 2026

Analysis:

25. A careful reading of the FIR unmistakably reveals that the

genesis of the dispute lies in a commercial transaction involving

supply of cotton by the complainant firm to Visalakshi Mills between

the years 1995 and 2000.The complainant himself admits that the

liability was acknowledged through an agreement dated 10.08.2000

and thereafter by a promissory note dated 29.04.2002. The

complainant further asserts that title deeds were deposited as

collateral security on 02.05.2002. Thus, the very substratum of the

complaint is undeniably contractual and commercial.

26. The subsequent grievance of the complainant arises from

alleged alienation of portions of the property many years later.

Significantly, the complaint itself reveals that substantial portions of

the properties had already been subjected to DRT/SARFAESI

proceedings and auction sales years earlier. The admitted existence

of long-standing civil proceedings, mortgage disputes and DRT

litigation overwhelmingly demonstrates the civil complexion of the

dispute.

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27. The offence of cheating requires fraudulent or dishonest

intention at the inception of the transaction. The complaint itself

demonstrates that the parties were engaged in sustained commercial

dealings over several years and that securities were allegedly

furnished towards repayment.

28. If the complainant’s own version is accepted, the accused

had deposited title deeds and executed promissory notes in favour of

the complainant. Such conduct is fundamentally inconsistent with a

preconceived fraudulent intention existing from inception. The

subsequent alienation of property decades later may at best give rise

to disputes concerning enforceability of mortgage or priority of rights.

However, such acts do not automatically translate into the offence of

cheating.

29. More importantly, insofar as A-9 and A-10 are concerned,

there are absolutely no averments demonstrating that they

participated in the original commercial transaction or possessed

dishonest intention at the inception thereof. The allegations against

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them are essentially founded upon purchase of property under a

registered sale deed.

30. The encumbrance certificate admittedly did not reflect the

alleged mortgage. The alleged security interest itself was

unregistered. Therefore, the allegation that A-9 and A-10 knowingly

participated in cheating is wholly inferential and unsupported by

concrete material.

31. The allegations relating to Section 321 BNS are equally

unsustainable. The complainant alleges suppression of existing

mortgage and filing of complaint regarding missing documents.

However, the essential dispute revolves around competing claims

over title deeds and enforceability of collateral security.

32. Whether the complainant had subsisting enforceable

rights, whether the mortgage remained legally alive, whether the

accused genuinely believed the documents to be lost and whether the

complainant retained lawful entitlement over the title deeds are all

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deeply disputed civil questions. Such questions cannot automatically

attract criminal liability.

33. The allegations relating to use of obscene language are

vague and omnibus. The FIR does not disclose the specific words

allegedly uttered, the exact circumstances in which they were spoken

or how the statutory ingredients stood satisfied. Mere general

allegations of abusive conduct without particulars cannot sustain

prosecution under Section 296(b) BNS.

34. Equally, the allegations concerning criminal intimidation

are bald and generalized. There is no material demonstrating

imminent threat, actual alarm or intention sufficient to attract

Section 351(2) BNS. Courts have consistently held that vague

allegations of threat casually incorporated in commercial disputes

cannot be permitted to become instruments of criminal prosecution.

35. Another striking feature is the extraordinary delay. The

foundational transactions are admittedly of the years 2000 and

2002. The FIR came to be registered only in December 2025. The

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complainant seeks to explain the delay by referring to subsequent

sale transactions. However, the core rights asserted by the

complainant undeniably arise out of alleged debt and mortgage

transactions more than two decades old.

36. Even according to the complainant, proceedings were

pending before the DRT long back and auction sales had already

taken place in respect of substantial extents of the very same

properties. The prolonged silence and inaction over decades

significantly reinforces the civil nature of the dispute.

37. Insofar as A-1 and A-4 are concerned, the allegations are

conspicuously omnibus. The complaint itself indicates that the

principal dealings were allegedly undertaken by Thiagarajan and

others connected with the company. The petitioners in Crl.O.P.(MD)

No.250 of 2026 are elderly women aged about 77 and 72 years

respectively.

38. No specific overt act constituting cheating, intimidation or

fraudulent inducement is attributed to them. Mere relationship with

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principal accused or shareholding connection in a company cannot

justify criminal prosecution in the absence of specific allegations.

39. Undoubtedly, the inherent power of this Court must be

exercised sparingly and with circumspection. Equally, it is well

settled that where criminal proceedings are manifestly attended with

mala fide intention or where the allegations predominantly disclose

civil disputes dressed in criminal colour, the High Court is duty

bound to prevent abuse of process. The present case falls squarely

within such category.

40. Continuation of criminal investigation in the present

factual matrix would amount to permitting criminal law to be

employed as a coercive mechanism for enforcement of disputed and

stale civil claims. This Court is therefore satisfied that the

allegations, even if accepted in entirety, do not disclose the essential

ingredients of the offences alleged against the petitioners.

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Epilogue:

41. Commercial disputes involving debts, mortgages, collateral

securities and title claims frequently generate intense acrimony

between parties. However, criminal law cannot be allowed to become

a substitute for civil remedies nor a weapon for recovery of disputed

dues after prolonged inaction.

42. The criminal justice system cannot be converted into a

forum for exerting pressure in aid of doubtful or time-barred civil

claims. Permitting such prosecutions to continue would seriously

dilute the distinction between civil wrongs and criminal offences.

This Court is therefore of the considered view that continuation of

the impugned FIR against the petitioners would amount to abuse of

process of law.

43. Accordingly,

(i) Crl.O.P.(MD) No.873 of 2026 is allowed;

(ii) Crl.O.P.(MD) No.250 of 2026 is allowed;

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(iii) the FIR in Crime No.74 of 2025 dated 19.12.2025 on the

file of the first respondent police is hereby quashed insofar as the

petitioners in both the Criminal Original Petitions are concerned;

(iv) consequently, connected miscellaneous petitions are

closed.

44. It is however made clear that this order shall not preclude

the de facto complainant from working out any civil remedy available

in law before the competent forum, if so advised.

01.06.2026

NCC : Yes / No

Index : Yes / No

Internet : Yes/ No

Sml

To

1. The Inspector of Police,

CCB, Madurai City.

2. The Additional Public Prosecutor,

Madurai Bench of Madras High Court,

Madurai.

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Crl.OP(MD)Nos.873 and 250 of 2026

L.VICTORIA GOWRI, J.

Sml

CRL OP(MD)Nos.873 and 250 of 2026

01.06.2026

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