Mere Breach Of Contract Is Not Cheating

Key Takeaways

• mere breach of contract cannot give rise to criminal prosecution for cheating.
• imparting criminal color to a civil dispute,is nothing but an abuse of the process of law which must be discouraged in its entirety

Background

• the complaint against the builder company was that it had sold four excess flats beyond its share, in terms of the JDA and supplementary agreement entered into between the parties.
• The complainants contended that the builder was entitled to sell only 9 flats in its favour, has instead executed sale deed for 13 flats in total.
• High Court, refused to quash the criminal proceedings.

Observations

• the bench noted that the dispute between the parties, could at best be termed as one involving a mere breach of contract
• For criminal prosecution, the key ingredient of having a dishonest or fraudulent intent under sections 405, 419 and 420 has to be made out.
• criminal color cannot be given to a civil dispute merely to take advantage of a relatively quick relief granted in a criminal case in contrast to a civil dispute. Such an exercise is nothing but an abuse of the process of law which must be discouraged in its entirety, the court added.

Questions

• What is your opinion on this judgement?
• How is cheating different than breach of contract?