Court Protects Peaceful Consumer Protest; Quashes Defamation Complaint Over Builder's Banner

A Bench of Justices K.V. Viswanathan and N. Kotiswar Singh heard an appeal challenging summons issued under Section 500 IPC for alleged criminal defamation arising from a public protest banner erected by flat purchasers against their developer. The appellants sought quashing of the complaint and the summons issued by the Metropolitan Magistrate, Borivali, Mumbai, which the Bombay High Court had refused to set aside.

The Court allowed the appeal and quashed the criminal complaint and summons, holding that the banner fell within the ambit of the Ninth Exception to Section 499 IPC and was a protected exercise of freedom of speech and peaceful protest under Articles 19(1)(a), (b) and (c). The Court reiterated that a Magistrate and a High Court, while considering process or a quashing petition, could examine whether an exception to defamation applied if the materials before the court disclosed a complete defence. The Court, in its reasoning, observed: “We find that the manner of the protest resorted to by the appellants was peaceful and orderly and without in any manner using offensive or abusive language. It could not be said that the appellants crossed the Lakshman Rekha and transgressed into the offending zone. Their case wholly falls within the sweep, scope and ambit of exception 9 to Section 499. Their peaceful protest is protected by Article 19(1)(a) (b) and (c) of the Constitution of India. The criminal proceedings levelled against them, if allowed to continue, will be a clear abuse of process.” The judgment also quoted the Ninth Exception: “It is not defamation to make an imputation on the character of another provided that the imputation be made in good faith for the protection of the interests of the person making it, or of any other person, or for the public good.”

Background The dispute arose after 128 flat purchasers, dissatisfied with the respondent-developer’s alleged failure to form a society, provide accounts, attend to defects, maintain lifts, and resolve water, plumbing and approach-road issues, erected two publicly visible banners on 10 August 2015 listing those grievances. The developer threatened defamation proceedings; when the appellants refused to apologise, the developer lodged a criminal complaint under Section 500 read with Section 34 IPC. The Magistrate issued summons on 4 October 2016. The appellants’ revision failed and the Bombay High Court dismissed their writ petition quashing process.

Before the Supreme Court, the appellants argued that the banner merely highlighted contractual and consumer grievances, invoked their right to freedom of speech and peaceful protest, and that civil remedies (including a suit later filed) addressed the disputes; they contended that the criminal complaint amounted to an attempt to criminalise a civil/business dispute and to chill free expression. The respondent maintained that the banner imputed facts that injured the company’s reputation, that no contemporaneous civil proceedings had been initiated by the appellants when the complaint was filed, and that the ingredients of Section 499 IPC were attracted.

The Bench examined Section 499 IPC, the Ninth Exception and the Court’s recent precedent in Iveco Magirus (2024), which confirmed that a Magistrate and High Court may, on the materials before them, consider whether an Exception to Section 499 provided a complete defence at the threshold. Applying those principles, the Court analysed the banner’s language, the business relationship between the parties, the absence of intemperate or abusive expressions, and the manner of protest. The Court relied on authorities recognising qualified privilege for communications made in good faith to protect one’s interests and emphasised the need to avoid chilling legitimate dissent and consumer expression. The Court found that the appellants had acted in good faith to protect collective interests and that the choice of words did not demonstrate malice or a propensity to lower the developer’s reputation in the requisite legal sense.

The Supreme Court set aside the High Court’s order dated 10.06.2024 and quashed the complaint in CC No. 2042/SS/2016 and the summons issued under Section 500 read with Section 34 IPC. The Court did not issue interim directions or record any separate liberty; it concluded that continuation of criminal proceedings would be an abuse of process.

Case Details: Case No.: 2025 INSC 502; Criminal Appeal No. 2033 of 2025 (@ Special Leave Petition (Criminal) No. 9942 of 2024) Case Title: Shahed Kamal & Ors. v. M/s A. Surti Developers Pvt. Ltd. & Anr. Appearances: For the Petitioner(s): [Advocates not indicated in the judgment] For the Respondent(s): [Advocates not indicated in the judgment]