Person Well Versed In Commerce Expected To Check Valuation Of Property Before Entering Into Transaction: Supreme Court Quashes Cheating FIR

The Supreme Court recently quashed a cheating FIR lodged by a businessman based in Gulf, stating that he being a man well versed in commerce should have checked the valuation of the property before entering into the transaction.

The bench of Justices UU Lalit and Bela M Trivedi was considering a criminal appeal assailing Kerala High Court's judgment dated September 29, 2020 by which the High Court had rejected the application filed u/s 482 CrPC seeking quashing of proceedings initiated pursuant to the FIR.

While allowing the appeal the bench in Jayahari & Anr v. State of Kerala and Anr said,

"As the facts on record show the complainant is a businessman working in Gulf. A man, well versed in commerce, would certainly be expected to check the valuation of the property before entering into any transaction. The dispute in question being purely civil in nature, the adoption of remedy in a criminal court would amount to abuse of the process of Court."

The complainant and the appellant entered into a transaction as per which the complainant had to purchase appellant's property. In order to enable the complainant to effectuate the purchase, the bank gave the complainant some load to make the consideration amount to the appellant.

The complainant later alleged that the valuation of the property was inflated by the appellants and filed a complaint u/s 420, 406 read with Section 34 of the Indian Penal Code, 1860.

While setting aside the High Court's order and quashing the proceedings, the bench said,

"Needless to say that the complainant will certainly be entitled to initiate such proceedings in a civil court as are available in law. As and when such proceedings are initiated, the same shall be taken to a logical conclusion without being influenced by any observations made by this Court in the instant appeal."

Case Title: Jayahari & Anr v. State of Kerala and Anr| Criminal Appeal No.128 Of 2022

Citation : 2022 LiveLaw (SC) 106

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