The Supreme Court on Monday (August 31) held that even where an FIR involves non-compoundable offences, criminal proceedings may be quashed on the basis of a settlement once the real victim has categorically settled the dispute with the accused, and the consent of an informant who is not the victim is not necessary.

“Disastrous consequences will arise if such informants (who are not victims) are allowed to enter into settlement and the real victim is left in limbo. Hence, what law contemplates is that it is the real victim who has to be a party to the settlement on the basis of which quashment of proceedings are sought under Section 482.”, observed a bench of Justice KV Viswanathan and Justice Arun Palli, while setting aside the Madhya Pradesh High Court's judgment which had refused to quash the criminal proceedings against the Appellant merely because the informant was not party to a settlement which had arrived between the Appellant and the real victim regarding quashment of the criminal proceedings.

Disagreeing with the High Court's approach, the Court observed that although a person other than the victim may set the criminal law in motion, such an informant cannot be permitted to enter into or prevent a settlement in a manner that leaves the actual victim without a say.

“…what law contemplates is that it is the real victim who has to be a party to the settlement on the basis of which quashment of proceedings are sought under Section 482. Further, the case on which quashment is sought should fall within the parameters of such categories of cases which could be quashed based on parties arriving at a settlement.”, the Court said.

Background

The case arose from a complaint filed by one Subhash Chandra Lalwani-informant in 2011 alleging that the appellant and three others had conspired to usurp around 54.48 acres of land belonging to real victim-Pradeep Singh Mehta.

The allegations included forgery of Mehta's signature on a General Power of Attorney and creation of a partnership deed for M/s Paradise Farms. The complainant also claimed an interest in a portion of the land which had allegedly been contributed to the partnership.

The Magistrate took cognizance of offences under Sections 466, 467, 468, 471, 420, 406 and 120B of the IPC.

After an earlier Section 482 petition was dismissed by the High Court in 2018, the appellant approached the High Court again, relying on a settlement with Mehta, the owner of the disputed property.

Mehta filed an affidavit stating that the land had been contributed to the partnership at his instructions, that the relevant formalities had been carried out accordingly, and that he had no grievance against the accused and did not wish to pursue the complaint.

The High Court nevertheless refused to quash the proceedings, holding that since the original complainant had not entered into the settlement, the proceedings could not be terminated.

Aggrieved by the High Court's decision, the appellant approached the Supreme Court.

Decision

Allowing the appeal, the judgment authored by Justice Viswanathan observed that the High Court erred in refusing to quash the criminal proceedings, merely on account of non-joining of the informant in a settlement arrived between the victim and accused persons.

The Court relying upon its 2012 judgment of Gian Singh vs. State of Punjab, later followed in Naushey Ali & Ors. Versus State of U.P. & Anr. 2025 LiveLaw (SC) 190, observed that an offence having a civil flavour where the wrong is basically to the victim and where the victim has settled all disputes, the High Court may quash the proceedings, even if the offences are not compoundable.

In essence, the Court emphasised that non-joining of the informant in a settlement arrived at between the appellant along with accused persons and victims would not be fatal for the quashing purposes.

“The offences alleged have a civil flavour with commercial overtones. In the face of settlement, chances of conviction are bleak. If not quashed, this will be one more case which will clog the judicial system and be a stumbling block for other important cases crying for justice. Ends of justice would be better served by weeding out these proceedings where the major protagonists in the drama who though originally were at daggers drawn, have buried their differences, shaken hands and moved on.”, the Court observed.

As a result, the appeal was allowed, thereby quashing the pending criminal proceedings against the Appellants in terms of the settlement arrived at with the victim.

Cause Title: Anand Kumar @ Sanjay Lalwani Versus The State of Madhya Pradesh And Ors.

Citation : 2026 LiveLaw (SC) 874

Click here to download judgment

Appearance:

For Petitioner(s) : Mr. R. Basant, Sr. Adv. Mr. Priyank Upadhyay, AOR Mrs. Shivali Sharma, Adv. Mr. Anadi Kumar Taylor, Adv. Ms. Aishwarya Srivastava, Adv.

For Respondent(s) : No.2 Ms. Meenakshi Arora,Sr.Adv. Mr. Utsav Trivedi, Adv. Mr. Harsh Pandya, Adv. Mr. Gaurav Sharma, Adv. For M/S. Tas Law, AOR

For respondent No.3 Mr. Sankalp Kochar, Adv. Mr. Siddharth R. Gupta, Adv. Mr. Mrigank Prabhakar, AOR Mr. Siddhant Kochar, Adv. Mr. Shantanu Sharma, Adv. Mr. Uddaish Palya, Adv. Ms. Vishala Dwivedi,Adv. Ms. Astha Singh, Adv.

For respondent No.1-State Mr. Rajan K Chaurasia, Adv. Ms. Mrinal Gopal Elker, AOR Mr. Rohit Singh, Adv.

For Applicant(s) in IA Nos.48090/2026 & 209992/2026 Mr. Anuj Bhandari, AOR