Builders who sold the same area twice on a forged plan cannot have the FIR quashed
Justice Ranjitsinha Raja Bhonsale refused relief under Section 482, holding that the planning authority had itself doubted the plan and that a civil remedy does not bar a criminal case.
Two builders who asked the Bombay High Court to quash an FIR alleging that they took money from flat buyers on a forged sanctioned plan, and sold the same areas more than once, have been refused. Justice Ranjitsinha Raja Bhonsale held that a prima facie case for the offences alleged is made out on the record, that the planning authority had itself doubted the genuineness of the plan in question, and that the petitioners' case does not fall within any of the categories laid down by the Supreme Court in Bhajan Lal. Their conduct, the judgment adds, disentitles them from claiming discretionary relief.
The FIR and the relief sought
The petition was filed under Section 482 of the Code of Criminal Procedure, now Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, together with Article 226 of the Constitution. The petitioners, who have their office at a builders' and associates' firm in Deonar, Mumbai, sought to quash C.R. No. 5 of 2020 dated 7 January 2020, registered at Govandi police station.
The FIR invokes Sections 420 and 409 read with Section 34 of the Indian Penal Code, Sections 3, 4 and 5 of the Maharashtra Ownership Flats Act, 1963, Sections 3, 4 and 5 of the Maharashtra Protection of Interest of Depositors Act, 1999, and Sections 465, 467, 468 and 471 of the Penal Code. The second respondent, described as a real estate broker and financer, is the first informant. The Slum Rehabilitation Authority was represented before the court, as was an intervener, and the State appeared through the Additional Public Prosecutor. The matter was reserved on 3 July 2026 and pronounced on 1 October 2026.
What the record showed
The judgment sets out the material on which it found a prima facie case, and it is cumulative rather than resting on any single document.
There are multiple flat purchasers who booked flats, paid substantial amounts and have not received possession. Some flats were created out of areas that had already been allotted and sold, and were then resold to third parties for valuable consideration, without the knowledge or consent of the original allottee or purchaser. Monies were taken on multiple occasions for flats for which there were no sanctioned plans. Agreements were executed and amounts accepted without the requisite approvals, on the basis of a plan which the record prima facie indicates was forged or fabricated.
The point Justice Bhonsale treats as most telling is not the complainant's allegation but the authority's own position: the authority itself had doubted the genuineness of the plan in question. On that footing the essential ingredients of the offences alleged in the FIR were, prima facie, available.
Why the civil framing failed
The petitioners' principal attempt was to recast the matter as a contractual dispute. They contended that an amount of Rs 3.46 crore was due and payable by eight buyers.
The judgment rejects that on two grounds, and the second is the sharper one. The contention was a belated attempt to raise a defence and to project the dispute as a civil proceeding or a case of breach of contract. And it contradicted the petitioners' own other defence — that the monies had been received as an investment or financing transaction, which is what they contended in respect of the second respondent. The two positions cannot both be true.
Conduct closed the gap. The record did not indicate that the petitioners had taken any step to terminate the other agreements, or any agreement, or to call upon the respective flat purchasers to pay the amounts said to be due. That conduct, the judgment holds, clearly demonstrates the intention.
On the broader proposition, the court recorded that initiating civil proceedings or availing a civil remedy does not automatically bar criminal proceedings, and that the FIR here discloses the essential ingredients of the criminal offence alleged. The facts prima facie establish both the intent and the dishonest intention, and the fraudulent or dishonest intent of the petitioners at the inception is prima facie made out.
The authorities, and the Bhajan Lal categories
Counsel for the petitioners relied on various judgments of the Supreme Court and re-emphasised the settled propositions of law on quashing. Justice Bhonsale recorded that there can be no quarrel with those propositions, but held that on the facts of this case none of the authorities would help the petitioners.
The reason is what the case is about. The matter pertains to the use of a false and forged sanctioned plan and to allotting and selling the same area to multiple buyers, done not once but repeatedly. The offence is forgery, which the judgment describes as a serious and grave offence. Measured against the categories enumerated by the Supreme Court in Bhajan Lal, the petitioners failed to bring their case within any of them; the acts and conduct disclosed, in the court's view, make out the very offences charged.
Order
No case was made out for invoking the inherent powers of the High Court under Section 482 of the Code of Criminal Procedure to quash the proceedings. The petition was dismissed. The judgment notes that the arguments the petitioners advanced are in the nature of defences, and that these can be considered at the trial.