In Brief
A bicycle manufacturing company's contract dispute with a subcontractor over payment for assembling bicycles was characterized as a criminal breach of trust and cheating case. The company paid Rs 62 lakhs (out of Rs 101.58 lakhs claimed) initially, then settled the dispute by paying an additional Rs 26 lakhs via a compromise deed, which the complainant accepted. The High Court refused to quash the FIR, finding criminal intent. The Supreme Court allowed the appeal, holding the dispute was essentially civil in nature—merely a disagreement over the number of bicycles assembled and payment due. Since the parties settled and the complainant accepted the additional payment, there was no evidence of fraudulent intent or coercion, making the criminal prosecution an abuse of process. The FIR was quashed.
The lawyer headnote and full judgment text are available to registered users.