Supreme Court Quashes FIR Against Project Manager, Holds Continuation Would Be Abuse Of Process

A bench of Justices C.T. Ravikumar and Sanjay Kumar heard an appeal by special leave against a decision of the Allahabad High Court that had refused to quash FIR No.64/2020 registered at Sadar Bazar Police Station, Meerut. The appeal arose from an FIR accusing several entities of cheating, criminal conspiracy and related offences in connection with alleged non-payment of about Rs.9 crore arising from construction sub-contracts; the appellant was the foreign national Project Manager of a principal contractor and challenged the FIR insofar as it named him.

The Supreme Court allowed the appeal, set aside the High Court judgment dated 26.08.2020 and quashed FIR No.64/2020 and all further proceedings insofar as they related to the appellant. The Court held that the recitals of the FIR, even taken at face value, did not disclose commission of offences against the appellant and that continuing proceedings against him would amount to an abuse of the process of law. The Court noted that quashing could be exercised under Article 226 or Section 482 Cr.P.C. to prevent miscarriage of justice. The Court, in its reasoning, observed: “In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 or the inherent powers under Section 482 of the Code ... we give the following categories of cases by way of illustration wherein such power could be exercised ... (1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence ... (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused ... (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive ...” The Court further observed that “asking the appellant to stand the trial will be nothing but an abuse of process of law.”

Background

The dispute arose from a construction contract awarded by Hyundai Motor India Limited to Hyundai Engineering & Construction India LLP (HEC India LLP) for a Gurgaon project. The appellant was the Project Manager of HEC India LLP. HEC India LLP sub-contracted to KOTEC Automotive Services India Pvt. Ltd., which in turn sub-contracted portions to YSSS India Construction; YSSS engaged RT Construction (the complainant). The complainant alleged that YSSS and others defaulted on payments totaling about Rs.9 crore and that several cheques were dishonoured. An FIR was registered under Sections 406, 420, 323, 504, 506 and 120-B IPC. The appellant received Section 91 Cr.P.C. notices and produced some documents but contended that other documents sought were not in his possession; he moved the High Court to quash the FIR. The High Court declined to quash but directed that the petitioner should not be arrested until credible evidence emerged or the police filed the report under Section 173(2) Cr.P.C. The Supreme Court had earlier issued notice on 14.10.2020 and stayed further proceedings; that interim order remained in force.

Relying on established precedents including State of Haryana v. Bhajan Lal, Pepsi Foods Ltd. v. Special Judicial Magistrate, Eastern Spinning Mills v. Rajiv Poddar and State of A.P. v. Golconda Linga Swamy, and having regard to this Court’s guidance in Mohammad Wajid v. State of U.P., the Supreme Court examined the FIR’s recitals and held that, apart from vague allegations, the complaint did not make out any case against the appellant. The Court found it appropriate to exercise extraordinary jurisdiction to quash the FIR insofar as it concerned the appellant, observing that non-interference would result in a miscarriage of justice. The appeal was allowed and the High Court order set aside; pending applications were disposed of.

Case Details: Case No.: SLP (Crl.) No.4849 of 2020 (Criminal Appeal @ 2025 INSC 8) Case Title: Kim Wansoo v. State of Uttar Pradesh & Ors. Appearances: For the Petitioner(s): Not indicated in the judgment For the Respondent(s): Not indicated in the judgment