Counterblast FIRs in cheque dishonour disputes can be quashed as abuse of process when mala fides are shown.

Criminal proceedings lodged as a retaliatory counterblast to pending cheque dishonour action under the Negotiable Instruments Act may be quashed under the inherent jurisdiction of the HC when the material shows mala fides and ulterior motive. Applying the settled principles for quashing and the Bhajan Lal category relating to maliciously instituted proceedings, the Court treated the FIR as an abuse of process because it followed notice in the Section 138 proceedings and arose out of prior commercial dealings. The dispute over the business name was treated as a defence issue in the cheque cases, not a proper foundation for criminal prosecution, and the FIR was quashed.

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Issues: Whether the FIR was liable to be quashed in exercise of inherent jurisdiction under Section 482 Cr.P.C. on the ground that it was a counterblast to proceedings under Section 138 of the Negotiable Instruments Act and amounted to abuse of process of law.

Analysis: The material placed before the Court showed that the cheques were issued in the course of prior commercial dealings, that dishonour proceedings under Section 138 of the Negotiable Instruments Act had already been initiated, and that the subsequent FIR was lodged soon after the complainant received notice of those proceedings. The Court applied the settled principles governing quashing under Section 482 Cr.P.C. and the categories illustratively stated in Bhajan Lal, particularly the category concerning criminal proceedings maliciously instituted with an ulterior motive. On the facts, the FIR was found to have been initiated as a retaliatory measure to avoid the consequences of the cheque dishonour litigation, and the alleged dispute regarding the business name was held to be a matter of defence in the cheque cases rather than a basis for criminal prosecution.

Conclusion: The FIR constituted abuse of process and was liable to be quashed; the petition was allowed in favour of the petitioners.

Final Conclusion: The criminal proceedings could not be permitted to continue because they were found to be a malicious counterblast to parallel cheque dishonour proceedings, and the Court exercised its inherent power to terminate the FIR.

Ratio Decidendi: Criminal proceedings that are instituted as a retaliatory counterblast to pending or threatened proceedings under the Negotiable Instruments Act, and which are attended with mala fides and ulterior motive, may be quashed under Section 482 Cr.P.C. as an abuse of process of law.

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