C. SUBBIAH @ KADAMBUR JAYARAJ AND OTHERSversusTHE SUPERINTENDENT OF POLICE AND OTHERS

                 [2024] 5 S.C.R. 813 : 2024 INSC 416

           C. Subbiah @ Kadambur Jayaraj and Others
                              v.
            The Superintendent of Police and Others
                    (Criminal Appeal No. 2582 of 2024)
                                 15 May 2024
                [B.R. Gavai and Sandeep Mehta,* JJ.]

                           Issue for Consideration
       Matter pertains to the permissibility of suing the accused for a
       civil wrong, in relation to the benami transactions, as a corollary,
       allowing criminal prosecution of the accused in relation to the
       same cause of action.

                                  Headnotes†
       Benami Transactions (Prohibition), Act 1988 – s. 4 – Benami
       transaction – Initiation of civil suit/criminal proceedings by
       the real owner of the benami property – Permissibility –
       Complainant-government teacher, previously doing real
       estate business, fraudulently allured and induced by the
       accused persons to invest in various land deals to earn high
       profits – Purchased properties not registered in complainant’s
       name despite the investments made by him and thereafter,
       the accused failed to deliver the plots or profits as agreed
       and thereby committed fraud and criminal breach of trust –
       Registration of FIR and filing of chargesheet – On the same
       set of allegations, the complainant filed civil suit against the
       accused persons, which is pending – Petition by the accused
       seeking quashing of the FIR and the chargesheet – Dismissed
       by the High Court:
       Held: Dispute is regarding the quantification of profits and full
       satisfaction of the share claimed by the complainant proportional
       to the investments made by him after sale of some plots –
       Complainant after being appointed in Government service would be
       conscious that indulging in land deals may land him in departmental
       proceedings, thus, must have agreed that the lands not be registered
       in his name – By virtue of s. 4(1) and 4(2), the complainant in
       spite of having made investments in the land deals in the names
       of other persons which were evidently benami transactions, was
       prohibited from instituting civil proceedings for recovery against
* Author
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       the accused persons-appellants – As a corollary, allowing criminal
       prosecution of the accused in relation to the self-same cause of
       action would be impermissible in law – Thus, in view of the clear
       bar contained in s. 4, the complainant could not have sued the
       accused for the same set of facts and allegations which were
       made the foundation of the criminal proceedings – Since, if such
       allegations did not constitute an actionable civil wrong, allowing
       the prosecution of the accused for the very same set of facts,
       would tantamount to abuse of the process of law – Furthermore,
       no allegation to persuade the Court to hold that the intention of the
       accused was to defraud the complainant right from the inception
       of the transactions – Also necessary ingredients of the offences
       punishable u/ss. 406, 420, 294(b) and 506(ii) IPC not made out
       against the accused – Dispute which is purely civil in nature was
       given a colour of criminal prosecution alleging fraud, breach of
       trust and criminal intimidation by misusing the tool of criminal law –
       Criminal prosecution instituted against the accused in pursuance of
       the totally frivolous FIR tantamounts to sheer abuse of the process
       of law – Thus, the impugned order quashed and set aside. [Paras
       36, 38, 42-48]
       Benami Transactions (Prohibition), Act 1988 – s. 4 – Benami
       transaction – Prohibition of the right to recover property held
       benami:
       Held: s. 4(1) makes it clear that no suit, claim or action to enforce
       any right in respect of any property held benami against the person
       in whose name the property is held or against any other person,
       shall lie or on behalf of a person claiming to be real owner of
       such property – Such person cannot raise a defence based on
       any right in respect of any property held benami either against the
       person in whose name the property is held or against any other
       person – s. 4(2) prohibits the institution of any suit, claim or any
       other action by and on behalf of a person claiming to be the real
       owner of such property. [Para 35]

                                Case Law Cited
       State of Haryana and Others v. Bhajan Lal and Others [1990]
       Suppl. 3 SCR 259 : 1992 Supp. 1 SCC 335; Indian Oil Corpn.
       v. NEPC India Ltd. and Others [2006] Supp. 3 SCR 704 : (2006)
       6 SCC 736; Anand Kumar Mohatta and Another v. State(NCT
       of Delhi), Department of Home and Another [2018] 13 SCR
[2024] 5 S.C.R.                                                            815

             C. Subbiah @ Kadambur Jayaraj and Others v.
                The Superintendent of Police and Others

     1028 : (2019) 11 SCC 706; Union of India v. Ganpati Dealcom
     (P) Ltd. [2022] 12 SCR 320 : (2023) 3 SCC 315; Sarabjit Kaur
     v. State of Punjab and Anr., 2023 SCC OnLine SC 210; Vijay
     Kumar Ghai v. State of W.B. [2022] 1 SCR 884 : (2022) 7 SCC
     124 – referred to.

                                List of Acts
     Penal Code, 1860; Code of Criminal Procedure, 1973; Prevention of
     Corruption Act, 1988; Benami Transactions (Prohibition), Act 1988.

                             List of Keywords
     Civil wrong; Benami transactions; Criminal prosecution; Cause of
     action; Fraudulently allured and induced; Fraud; Criminal breach of
     trust; Departmental proceedings; Quantification of profits; Criminal
     intimidation; Abuse of the process of law.

                            Case Arising From
     CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No. 2582
     of 2024
     From the Judgment and Order dated 23.04.2018 of the High Court of
     Judicature at Madras at Madurai in CRLOP No. 3846 of 2013
                         Appearances for Parties
     Dama Seshadri Naidu, Sr. Adv., Pai Amit, Tushar Bakshi, Mrs.
     Naresh Bakshi, Abhiyudaya Vats, Ashish Jacob Mathew, Advs. for
     the Appellants.
     D. Kumanan, Veshal Tyagi, M.P. Parthiban, Ms. Priyaranjani
     Nagamuthu, Ms. Shalini Mishra, R. Sudhakaran, T. Hari Hara Sudhan,
     Bilal Mansoor, Shreyas Kaushal, P.V.K. Deivendran, Advs. for the
     Respondents.
                 Judgment / Order of the Supreme Court
                                 Judgment
     Mehta, J.
1.   Leave granted.
2.   The instant appeal by special leave is filed against the judgment dated
     23rd April, 2018 passed by learned Single Judge of the Madras High
     Court, Madurai Bench dismissing the CRL.O.P.(MD) No. 3846 of 2013
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       preferred by the appellants herein seeking quashing of proceedings
       of Criminal Case No. 250 of 2012 pending in the Court of learned
       Judicial Magistrate No. II, Kovilpatti for offences punishable under
       Sections 420 read with Section 120B, Section 294(b), Section 506(ii)
       read with Section 114 of the Indian Penal Code, 1860(hereinafter
       being referred to as the ‘IPC’).
       Brief facts:-
3.     Respondent No. 3(hereinafter being referred to as the ‘complainant’)
       lodged a complaint in the Court of learned Judicial Magistrate No.
       II, Kovilpatti alleging inter alia that he was having a qualification of
       M.Sc., MD Graduate. He was appointed as a Government teacher
       on 8th October, 2007. Before being appointed as a Government
       teacher, the complainant was doing real estate business for earning
       his livelihood for past 16 years.
4.     The complainant was knowing Kannabiran(hereinafter being
       referred to as ‘A-3’) who was working as a Manager in the State
       Bank of India(SBI), Kovilpatti Branch. While being engaged in
       the real estate business, the complainant came into contact
       with Subbiah @ Kadambur Jeyaraj(hereinafter being referred to
       as ‘A-1’) and his wife A. Vijaya(hereinafter being referred to as
       ‘A-2’). Through A-1 and A-2, the complainant came into contact
       with Chandrasekar(hereinafter being referred to as ‘A-4’), his
       son Pandiyaraj(hereinafter being referred to as ‘A-6’), his wife(S.
       Pandiyammal, hereinafter being referred as ‘A-5’), and his brother
       (K.Shanmugiah, hereinafter being referred as ‘A-8’) who were also
       engaged in real estate business.
5.     The complainant claimed that he always trusted his partners in
       business. Taking undue advantage of the trusting nature of the
       complainant, the accused persons induced him to join their real estate
       business claiming that they had strong political connections. The
       accused allured and induced the complainant to enter into land deals
       with the intention to defraud the complainant right at the inception of
       the transactions. The complainant was told that the documents need
       not be registered in his own name and instead the registration may
       be carried out in the name of his sister-in-law. An alternative option
       was given that if the documents were registered in the names of the
       accused, the plots could be sold immediately to earn higher profits.
       By flaunting their political connections, the accused influenced the
[2024] 5 S.C.R.                                                         817

             C. Subbiah @ Kadambur Jayaraj and Others v.
                The Superintendent of Police and Others

     complainant to make investments into lands assuring that he would
     reap huge benefits out of these deals.
6.   The complainant was also fraudulently induced to believe that out of
     the chunks of lands so purchased, smaller plots would be carved out
     and sold to different persons which would frequently require physical
     presence of the seller and since the complainant was a teacher, he
     would face inconvenience if the land parcels were to be registered
     in his name. In this manner, the complainant was not allowed to get
     the purchased properties registered in his name despite he making
     the investments. The complainant was given assurances that the
     plots would be sold for huge profit in a very short duration and he
     would be given his share. By using this mode of inducement, A-1,
     A-3, A-4, and A-6 infused a sense of trust in the complainant with
     the ulterior motive to defraud him and to commit breach of trust.
7.   It was further alleged that before the complainant had come in
     touch with the accused, he and his brother-in-law Chandrasekar,
     S/o Krishnasamy Naicker had entered into an agreement for sale
     with A. Sairam in respect of a chunk of land at Allampatti village,
     admeasuring 8 acres, but the sale could not be finalized because a
     suit was pending in the District Court, Tuticorin in respect of the said
     land. In the meantime, the complainant was appointed as a teacher.
     The suit pending before the District Court, Tuticorin was disposed
     in favour of A. Sairam.
8.   Having given the fraudulent allurements to the complainant, the
     accused got registered a sale deed in their name as Document No.
     1839 of 2008 dated 27th February, 2008 on the file of Sub Registrar
     Office, Kovilpatti in respect of some plots of land situated in the
     Allampatti village of total area 7.618 acres. The complainant invested
     a sum of Rs. 1,01,47,800/- towards this transaction whereas, the
     accused invested proportionately much lesser amounts in the said land
     deal. A-1, A-3, A-4, and A-6 along with the complainant, purchased
     the said parcel of land from A. Sairam for a total consideration of
     Rs. 3,08,33,600/-. However, as per the complainant, the accused
     never gave him the plots equivalent to the investment made by him
     and thereby, committed fraud and breach of trust.
9.   The complainant further alleged that A-2 and A-5 had conspired
     with A-1, A-3, A-4, and A-6 to cheat him. The accused made the
     complainant believe that the business of real estate is generally
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       carried on by word of mouth and trust. However, at a later point of
       time, the accused started indulging in criminal breach of trust with
       the ulterior motive of cheating the complainant.
10. A-1, A-3, A-4 and A-6 invested the amount provided by the
    complainant towards his share in the land deal and completed the
    sale of the suit property on 27th February, 2008 with A. Sairam.
    However, despite the assurances, the accused conspired and
    refused to give the due share of plots to the complainant thereby
    committing breach of trust. Therefore, a Panchayat meeting was
    convened on 19 th July, 2010 and a settlement deed was also
    executed wherein, it was agreed that 52 plots admeasuring 256.51
    cents would be handed over by A-1 and A-2 to the complainant
    towards the investment made by him.
11. Under the same settlement, A-4 and A-6 were given 45 plots to
    the extent of 233.50 cents for the investment made by them after
    deducting land to the extent of 16.50 cents towards the passages.
    On the very date of execution of the settlement deed, all the accused
    entered into an agreement with Dharamraj(hereinafter being referred
    to as ‘A-7’), brother-in-law of A-4 and executed a General Power of
    Attorney(GPA) in his favour after receiving a sum of Rs. 30,00,000/-
    towards plots Nos. 68, 69, 70 and 71 which were a part and parcel
    of the settlement deed.
12. The complainant alleged that the accused failed to pay a sum of Rs.
    19,00,000/- which would be the share amount due to the complainant
    out of the sale price of Rs. 30,00,000/-. Thus, the accused persons
    despite being signatories to the settlement deed did not act as
    promised under the settlement and thereby, committed breach of trust.
13. The accused had also promised to execute the sale deeds of some
    plots in favour of the persons to be nominated by the complainant. The
    complainant provided names of three persons for these plots. Three
    sale deeds were got prepared on stamp papers worth Rs. 90,000/-.
    The accused gave their photographs and ID-proofs and signed the
    sale deeds, but they failed to appear at the Sub-Registrar Office,
    Kovilpatti at the scheduled time for registration of the sale deeds.
    When the complainant enquired from A-1 and A-3 as to why they
    were indulging in such fraudulent acts, they abused the complainant
    and threatened to get rid of him. A-1 threatened the complainant
    that if the matter is reported to the police, he would shoot and kill
[2024] 5 S.C.R.                                                      819

             C. Subbiah @ Kadambur Jayaraj and Others v.
                The Superintendent of Police and Others

     the complainant and his family members by using a revolver. While
     saying so, A-1 brandished a revolver and handed it over to A-3.
14. It was further alleged that A-1 further induced the complainant to pay
    a sum of Rs. 41,00,000/- on 14th November, 2011, whereafter, the
    sale deed for one of the properties forming a part of the settlement
    memorandum was executed. However, for some of the properties,
    the accused were not abiding by the terms of the memorandum and
    had fraudulently transferred the same to other investors. Some land
    brokers were also present at the time when this incident occurred.
15. Being aggrieved of these continued criminal activities of the
    accused, the complainant submitted a complaint dated 29th June,
    2010 at the Kovilpatti West Police Station but no action was taken
    thereupon. Having failed to get any action on his complaint, the
    complainant approached the Madras High Court, Madurai Bench
    by filing CRL.O.P.(MD) No. 1396 of 2011 and as per the directions
    of the High Court, he submitted a fresh complaint to the District
    Superintendent of Police, Tuticorin, but still the FIR was not
    registered. Ultimately, the complainant was compelled to file a
    complaint in the Court of the Jurisdictional Magistrate with a prayer
    to forward the same to the police under Section 156(3) of Code of
    Criminal Procedure, 1973.
16. Under the direction of the learned Magistrate, the complaint was
    forwarded to Police Station Kovilpatti West, where FIR No. 305 of
    2011 dated 6th March, 2011 came to be registered. After investigation,
    the Investigating Agency, proceeded to file a charge sheet against
    eight accused with the following conclusions: -
           “By these Criminal Acts accused 1 to 6 have made to
           believe the complainant by their honey coated words
           have purchased lands, along with the complainant,
           in Alampatti Village in Survey No.218/B - 1.5 Acres,
           Survey No. 219 - 2.74 Acres, Survey No.218/1 - 1
           Acre, Survey No.221/1 - 2.37 Acres totaling in all 7
           Acres 61 cents which are valued Rs.6,18,500/- as per
           guideline value but paid Rs.3,08,33,600/- and registered
           the sale deed as Doc.No.1839/08 on the file of SRO
           Kovilpatti, out of the said sale consideration have paid
           the complainant Rs.10,00,100/- as per his proportionate
           share of his investment and without paying the balance
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          sale consideration of Rs.91,47,700/- towards his share
          received from the sale consideration or by not giving the
          proportionate land in alternate, they indulged in cheating
          activities. Therefore the acts committed by the accused
          or criminal nature and they appear to have committed the
          criminal acts which are punishable under the following
          Sections:
          The 1st accused punishable under Section 420 IPC r/w.
          120(B) IPC and Section 294(b), 506(ii) of IPC.
          The 2nd accused punishable under Section 420 IPC r/w
          Section 120(B) IPC.
          The 3rd accused punishable under Section 420 IPC r/w.
          120(B) IPC and Section 294(b), 506(ii) of IPC r/w 114 of
          IPC.
          The 4th accused punishable under Section 420 IPC r/w
          Section 120(B) IPC.
          The 5th accused punishable under Section 420 IPC r/w
          Section 120(B) of IPC.
          The 6th accused punishable under Section 420 IPC r/w
          Section 120(B) of IPC.
          The 7th accused punishable under Section 420 IPC r/w
          Section120(B) of IPC.
          The 8th accused punishable under Section 420 IPC r/w
          Section 120(B) of IPC.”
17. It may be mentioned that for the very same set of allegations, the
    complainant had also filed a civil suit by impleading A-1 to A-6 as
    defendants which is pending on the file of District Judge, Tuticorin
    in O.S. No. 06 of 2012.
18. A-1, A-2, A-3, A-4, A-5, A-6, A-7, and A-8 being the appellants herein,
    approached the Madras High Court, Madurai Bench for assailing
    the FIR and the charge sheet by filing a CRL.O.P.(MD) No. 3846 of
    2013. The learned Single Judge of Madras High Court proceeded
    to dismiss the said petition preferred by the appellants vide order
    dated 23rd April, 2018 which is subject matter of challenge in this
    appeal by special leave.
[2024] 5 S.C.R.                                                      821

             C. Subbiah @ Kadambur Jayaraj and Others v.
                The Superintendent of Police and Others

     Submissions on behalf of appellants: -
19. Learned senior counsel, Mr. Dama Seshadri Naidu representing
    the appellants vehemently and fervently contended that even if the
    allegations set out in the FIR and the charge sheet are treated to be
    true on the face of record, the same do not constitute the necessary
    ingredients of the offences alleged. He contended that looking at
    the admitted facts as set out in the complaint, the dispute, if any,
    between the parties is purely of civil nature and thus, continuance
    of the proceedings pursuant to the charge sheet filed against the
    accused appellants would tantamount to gross abuse of process
    of law. The charge sheet clearly spells out that a part of the sale
    proceeds from the land deals were paid to the complainant, but the
    entire amount as per his entitlement was not paid. Thus, as per Shri
    Naidu, for alleged part performance of contractual obligations, the
    tool of criminal law has been misused by the complainant.
20. He further submitted that the complainant being a teacher serving in
    the Government establishment was not entitled to indulge in property
    transactions and thus, at his own risk, he made the investments
    through the accused appellants herein and when the profit sharing
    quotient towards the land deals did not work out to the complainant’s
    satisfaction, the process of criminal law was misused so as to launch
    a purely frivolous prosecution against the accused appellants.
21. The contention of the learned senior counsel was that there is no
    material whatsoever on the record of the case to show that the
    intention of the accused appellants was to defraud the complainant
    right at the time of the inception of the transactions. Furthermore,
    since the allegation of the complainant is regarding disproportionate
    sharing of profits enuring from the land deals which he entered with
    the accused appellants with open eyes, the offence of criminal breach
    of trust would also not be made out against the accused appellants.
22. He urged that the essential ingredients of the offences alleged are
    not made out from the highest allegations levelled by the complainant
    as set out in the charge sheet warranting continuation of the criminal
    proceedings against the accused appellants. He placed reliance
    on the judgments of this Court in State of Haryana and Others v.
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       Bhajan Lal and Others1; Indian Oil Corpn. v. NEPC India Ltd. and
       Others2 and Anand Kumar Mohatta and Another v. State(NCT
       of Delhi), Department of Home and Another3 in support of his
       contentions and buttressed that the criminal proceedings sought to
       be taken against the appellants as a consequence to the charge
       sheet are fit to be quashed as the same amount to a sheer abuse
       of process of Court apart from the fact that the charge sheet does
       not disclose the necessary ingredients of any cognizable offence.
       Submissions on behalf of respondents-complainant and State:-
23. Per contra, learned counsel for the respondent complainant as well
    as the learned Standing Counsel representing the State vehemently
    and fervently opposed the submissions advanced by the learned
    counsel for the appellants. It was contended that, the accused
    appellants won over the trust of the complainant by using honey
    quoted language, and thereby, fraudulently induced him to make
    huge investments in land deals. The complainant was assured
    time and again by the accused that he would be given his due
    share of profits or the plots from the lands, as the case may be,
    which would be purchased in the name of the accused because the
    complainant being a Government teacher could not indulge into such
    transactions. The complainant fell for the allurements given by the
    accused appellants and invested huge sums of money for land deals
    placing blind faith on the assurances given by accused. However, the
    accused appellants resiled from their promises and defrauded the
    complainant by failing to give him the requisite number of plots which
    would fall in his share commensurate with the investment made by
    him. The complainant was also deprived of his rightful share in the
    profits reaped after some of the plots had been sold.
24. They submitted that merely because the complainant has also availed
    civil remedy for the same grievances, that by itself cannot disentitle
    him from invoking jurisdiction of the criminal Court to prosecute the
    accused appellants for their fraudulent acts because the allegations set
    out in the complaint constitute both the civil wrong as well as criminal
    offences and thus parallel proceedings can continue. On these grounds,


1   [1990] Supp. 3 SCR 259 : 1992 Supp(1) SCC 335
2   [2006] Supp. 3 SCR 704 : (2006) 6 SCC 736
3   [2018] 13 SCR 1028 : (2019) 11 SCC 706
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             C. Subbiah @ Kadambur Jayaraj and Others v.
                The Superintendent of Police and Others

     learned counsel for the complainant and the learned Standing Counsel
     for the State implored the Court to dismiss the appeal.
     Consideration of submissions and material on record: -
25. Heard the learned counsel for the parties at length and perused the
    impugned order as well as the complaint and the charge sheet filed
    against the accused appellants.
26. The arguments were heard, and the judgment was reserved on 16th
    February, 2024. Thereafter, we thought it fit to seek a clarification
    from the learned counsel for the parties because on going through
    the material available on record, we were prima facie of the opinion
    that the case presents sufficient material to direct inquiry under the
    provisions of Section 13(1)(b) and Section 13(2) of the Prevention of
    Corruption Act, 1988(hereinafter being referred to as ‘PC Act’) because,
    manifestly, the complainant being a public servant had indulged in
    large scale benami land transactions without disclosing the same to
    his employer. Accordingly, learned counsel for the complainant was put
    to notice and he has submitted a short clarificatory note mentioning
    therein that the complainant is an Income Tax assessee from the year
    2000. It is also submitted in the note that the complainant started
    the business of real estate from the year 2004 onwards and had
    acquired significant wealth during the course of this business. The
    complainant was appointed as a teacher in the Government School
    only in the year 2007 when he was nearly 45 years of age. He has
    superannuated in the year 2022 without any pensionary benefits. Thus,
    it was submitted that whatever money the complainant invested in
    the disputed land deals entered into with the accused, were genuine
    investments made by using his valid and declared sources of income
    and savings. A chart was also set out along with this explanation
    regarding the sources from where the complainant received various
    amounts which he claims to have invested in the disputed land deals.
27. Being satisfied with the explanation so offered, we do not find any
    justifiable cause so as to direct an enquiry against the complainant
    for the offences under the PC Act.
28. Now, we proceed to appreciate the merits of the present appeal.
29. At the outset, we may note that the complainant has come out with
    a clear case that he was already involved in real estate business
    before being selected as a Government teacher in the year 2007.
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       Hence, it can safely be assumed that he was well versed with the
       nitty gritties of such business and the innocence and ignorance
       feigned by him in the complaint qua pros and cons of fallouts of
       property dealings cannot ex facie be countenanced.
30. The complainant has alleged in the FIR, that the accused fraudulently
    allured him into buying the lands by using honey quoted words and
    that they also took advantage of the fact that the complainant was
    a teacher serving in a Government institution and hence he was
    persuaded to get the lands registered in the name of the accused.
    However, these allegations are one sided and do not present the true
    picture. The complainant after having been appointed in Government
    service would be conscious that indulging in land deals may land
    him in departmental proceedings. It was precisely for that reason,
    the complainant must have agreed that the lands to be purchased
    may not be registered in his name. On the face of the record, the
    property deals allegedly made in the names of other persons by
    using the funds partially provided by the complainant were benami
    transactions.
31. We may, at this stage, refer to the relevant provisions of the Benami
    Transactions (Prohibition), Act 1988(hereinafter being referred to as
    the ‘Benami Act’)(applicable at the time of the alleged transactions),
    and particularly Section 2(a), Section 2(c) and Section 4 thereof: -
           “2. Definitions- In this Act, unless the context otherwise
           requires,--
           (a)   benami transaction means any transaction in
                 which property is transferred to one person for a
                 consideration paid or provided by another person;
           (b)   …….
           (c)   property means property of any kind, whether movable
                 or immovable, tangible or intangible, and includes
                 any right or interest in such property
           “4. Prohibition of the right to recover property held
           benami-
           (1)   No suit, claim or action to enforce any right in respect
                 of any property held benami against the person in
                 whose name the property is held or against any other
[2024] 5 S.C.R.                                                           825

               C. Subbiah @ Kadambur Jayaraj and Others v.
                  The Superintendent of Police and Others

                   person shall lie by or on behalf of a person claiming
                   to be the real owner of such property.
            (2)    No defence based on any right in respect of any
                   property held benami, whether against the person
                   in whose name the property is held or against any
                   other person, shall be allowed in any suit, claim or
                   action by or on behalf of a person claiming to be the
                   real owner of such property.
            (3)    Nothing in this section shall apply,--
                   (a)     where the person in whose name the
                           property is held is a coparcener in a Hindu
                           undivided family and the property is held
                           for the benefit of the coparceners in the
                           family; or
                   (b)     where the person in whose name the
                           property is held is a trustee or other person
                           standing in a fiduciary capacity, and the
                           property is held for the benefit of another
                           person for whom he is a trustee or towards
                           whom he stands in such capacity.”
32. As per Section 2(a), any transaction in which property is transferred
    to one person for a consideration paid or provided by another person
    would be a “benami transaction”.
33. As per Section 2(c), “property” means property of any kind, whether
    movable or immovable, tangible or intangible, and includes any right
    or interest in such property.
34. Sections 3 of the Benami Act have been declared unconstitutional
    by this Court in the case of Union of India v. Ganpati Dealcom (P)
    Ltd4. A review petition is, however, pending against the said judgment.
35. Section 4(1) of the Benami Act makes it clear that no suit, claim or
    action to enforce any right in respect of any property held benami
    against the person in whose name the property is held or against
    any other person, shall lie or on behalf of a person claiming to be
    real owner of such property. Such person cannot raise a defence


4   [2022] 12 SCR 320 : (2023) 3 SCC 315
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       based on any right in respect of any property held benami either
       against the person in whose name the property is held or against
       any other person. Section 4(2) prohibits the institution of any suit,
       claim or any other action by and on behalf of a person claiming to
       be the real owner of such property.
                                                        (emphasis supplied)
36. It is, thus, clear that the complainant in spite of having made
    investments in the land deals which were evidently benami
    transactions, could not have instituted any civil proceedings for
    recovery against the person(s) in whose name, the properties were
    held which would be the accused appellants herein. Since by virtue
    of the provisions contained in Sections 4(1) and 4(2) of the Benami
    Act, the complainant is prohibited from suing the accused for a
    civil wrong, in relation to these benami transactions, as a corollary,
    allowing criminal prosecution of the accused in relation to the self-
    same cause of action would be impermissible in law.
37. Going by the allegations as set out in the FIR and the charge sheet,
    it is apparent that it is the admitted case of the complainant that the
    accused appellants made over a part of the purchased lands/plots to
    the complainant and also paid a part of the profits to him. However,
    when the exact share of the investment on pro-rata basis was not
    being given to the complainant, he was compelled to convene a
    Panchayat meeting wherein a Memorandum of Settlement was arrived
    at. Even despite the settlement, the actual share of the lands and
    profits enuring to the complainant was not paid to him. The relevant
    extract from the complaint is reproduced hereinbelow: -
            “10. As a per the Memorandum of Settlement it has been
            ensured that a Plot measuring 169 cents in the Property Item
            No.5 should be given to the complainant for his investment.
            It is also been assured that 32 cents to the 3rd accused
            Kannabiran and 55.50 cents to the 1st accused Subbiah
            @ Kadambur Jeyaraj. Upon the continuous insistence of
            the complainant to register the sale on 169 cents in his
            favour, the 1st and 3rd accused and all other accused
            informed the complainant that they will come on 9.9.2010
            to register the complainant’s share. But on 9.9.2010 the
            3rd accused Kannabiran only came to the Sub - Registrar
            Office, Kovilpatti. The complainant asked the 3rd accused
[2024] 5 S.C.R.                                                              827

             C. Subbiah @ Kadambur Jayaraj and Others v.
                The Superintendent of Police and Others

           about the other accused, he replied that he did not know
           about them and he said the complainant pays the entire
           amount for 32 cents he is ready to execute the sale deed
           and therefore the complainant paid the entire amount for
           32 cents and after receiving the same on 09.09.2010 the
           3rd accused executed a sale deed in respect of his 1/4th
           undivided share and the same was registered as Doc.
           No.8124 of 2010 then he left. For the investment amount
           made by the complainant, he has to get 169 cents, adding
           the plots to the extent of 32 cents settled by the 3rd accused
           Kannabiran the complainant has to get in total 201 cents.
           Out of this Kannabiran has got right to sell his 1/4th undivided
           share which is equivalent to 103 cents only. The 1st accused
           C.Subbiah @ Kadambur Jeyaraj can execute the Plots only
           to an extent of 100 cents to the complainant. But having
           committed the breach of trust and cheating the complainant
           without coming to the Sub Registrar Office on 9.9.2010
           and keeping the 1 acre without executing in favour of the
           complainant, he is not only committing a breach of trust
           but also intimidating the complainant by threatening the
           complainant continuously with dire consequences that he
           is having political influence and no one can do anything.
           11. Since the 1st Accused expressed his willingness to
           execute a sale deed in respect of the Property Item No.2 in
           the Memorandum of Settlement dated 19.10.2010 which is
           plots situate in Nehru Maha College Road, Malumichampatti
           Village, Kovai Corporation, if the complainant pays a sum
           of Rs.41,00,000/- to the 1st Accused. Believing his words
           the complainant on 14.1.2011 paid a sum of Rs.41,00,000/-
           to the 1st Accused and completed the sale. And also
           gave an assurance that they will act in accordance with
           the Settlement and on the very same date executed an
           Agreement of Execution. But they have been cheating
           the complainant without transferring the complainant’s
           share in the Property Item No.5 as per the settlement
           dated 19.07.2010. Also it is found in the Memorandum of
           Settlement dated 19.7.2010 that as for as the Item No.1
           concern only the 1st accused has to get the release after
           paying Rs.31,52,000/- to the Complainant. The 1st accused
           is cheating even without executing the same. And as per
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            the Memorandum of Settlement dated 19.7.2010 as for as
            the 3rd Item is concern they have to divide the property in
            proportionate to their respective investments. Item No.4
            has already been sold by the investors.”
38. It is thus clear that from the complaint, there is no such allegation
    therein which can persuade the Court to hold that the intention of
    the accused appellants was to defraud the complainant right from
    the inception of the transactions. The accused appellants have
    unquestionably, passed on some plots as well as part profits from
    the land deals to the complainant but the dispute is regarding the
    quantification of profits and full satisfaction of the share claimed by
    the complainant proportional to the investments made by him.
39. These allegations can at best give a cause to the complainant to
    sue the accused appellants in a civil Court. However, as discussed
    above, such remedy is barred by Section 4 of the Benami Act.
40. The complainant has clearly alleged that the accused caused him
    monetary loss because the appropriate share of profits was not
    passed on to him after some plots from the entire chunk had been
    sold. This Court in the case of Sarabjit Kaur v. State of Punjab
    and Anr5 observed that: -
             “A breach of contract does not give rise to criminal
            prosecution for cheating unless fraudulent or dishonest
            intention is shown right at the beginning of the transaction.
            Merely on the allegation of failure to keep up the promise
            will not be enough to initiate criminal proceedings”.
41. Similarly, in the case of Vijay Kumar Ghai v. State of W.B.6, this
    Court while tracing the earlier decisions on the subject observed
    as under:
            24. This Court in G. Sagar Suri v. State of U.P. [G. Sagar
            Suri v. State of U.P., (2000) 2 SCC 636] observed that it
            is the duty and obligation of the criminal court to exercise
            a great deal of caution in issuing the process, particularly
            when matters are essentially of civil nature.



5   2023 SCC OnLine SC 201
6   [2022] 1 SCR 884 : (2022) 7 SCC 124
[2024] 5 S.C.R.                                                           829

             C. Subbiah @ Kadambur Jayaraj and Others v.
                The Superintendent of Police and Others

           25. This Court has time and again cautioned about
           converting purely civil disputes into criminal cases. This
           Court in Indian Oil Corpn. [Indian Oil Corpn. v. NEPC India
           Ltd., (2006) 6 SCC 736] noticed the prevalent impression
           that civil law remedies are time consuming and do not
           adequately protect the interests of lenders/creditors. The
           Court further observed that : (Indian Oil Corpn. case [Indian
           Oil Corpn. v. NEPC India Ltd., (2006) 6 SCC 736)
                “13. … Any effort to settle civil disputes and
                claims, which do not involve any criminal offence,
                by applying pressure through criminal prosecution
                should be deprecated and discouraged.”
42. Thus, we are of the firm view that the necessary ingredients of the
    offences punishable under Section 406 and Section 420 IPC are
    not made out against the accused appellants from the admitted
    allegations set out in the complaint and the charge sheet. It cannot
    be doubted that a dispute which is purely civil in nature has been
    given a colour of criminal prosecution alleging fraud and criminal
    breach of trust by misusing the tool of criminal law.
43. The Investigating Officer has also applied offences under Section
    294(b) and Section 506(ii) read with Section 114 IPC in the charge
    sheet. On going through the entire charge sheet, we do not find
    any such material therein which can justify invocation of the offence
    under Section 294(b) IPC which reads as below: -
           “294. Obscene acts and songs.—Whoever, to the
           annoyance of others,
                (a)   ….
                (b)   sings, recites or utters any obscene song, ballad
                      or words, in or near any public place,
                Shall be punished with imprisonment of either
                description for a term which may extend to three
                months, or with fine, or with both.”
44. The complainant alleged that the accused abused him by using
    profane language. Section 294(b) IPC would clearly not apply to
    such an act. Apart from a bald allegation made by the complainant
    that A-1 abused him and intimidated him on 28th July, 2010, there is
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       no material which can show that the accused indulged in criminal
       intimidation of the complainant so as to justify invocation of the
       offence punishable under Section 506(ii) IPC.
45. We have to be conscious of the fact that the complainant has tried
    to misuse the tool of criminal law by filing the patently frivolous FIR
    dated 6th March, 2011, wherein the allegation is levelled regarding
    the so-called incident of criminal intimidation dated 28th July, 2010.
    The said allegation otherwise is also belied for the reason that in the
    FIR, the complainant states that he filed a complaint dated 29th July,
    2010 in Kovilpatti West Police Station, but the RTI reply from the said
    police station clearly states that no such complaint was ever received.
46. Thus, we are persuaded to accept the contention of learned counsel
    for the accused appellants to hold that the criminal prosecution
    instituted against the accused appellants in pursuance of the totally
    frivolous FIR tantamounts to sheer abuse of the process of law.
47. At the cost of repetition, it may be reiterated that in view of the
    clear bar contained in Section 4 of the Benami Act, the complainant
    could not have sued the accused appellants for the same set of
    facts and allegations which are made the foundation of the criminal
    proceedings. Since, if such allegations do not constitute an actionable
    civil wrong, in such circumstances, allowing the prosecution of the
    accused appellants for the very same set of facts, would tantamount
    to abuse of the process of law.
48. Consequently, the impugned order whereby the petition filed by the
    appellants seeking quashing of the Criminal Case No. 250 of 2012
    and FIR No. 305 of 2011 was dismissed, does not stand to scrutiny,
    thus, the same is hereby quashed and set aside.
49. As a result, all proceedings sought to be taken against the appellants
    in pursuance of the charge sheet dated 10th August, 2011 are also
    quashed.
50. The appeal is allowed accordingly.
51. Pending application(s), if any, shall stand disposed of.

       Result of the case: Appeal allowed.


       †
           Headnotes prepared by: Nidhi Jain