Civil contract disputes cannot be converted into criminal cases when cheating or forgery ingredients are absent.

Where allegations arising from a work contract are predominantly civil and the record does not disclose the essential ingredients of cheating, deception or forgery, criminal proceedings may be treated as abuse of process and quashed in exercise of inherent powers under Section 482 CrPC. The existence of an arbitration clause, the commencement of arbitration, and the complainant's admission that the work could not be continued supported the view that the dispute was contractual and suitable for civil adjudication. Continuation of the FIR and the Section 156(3) order was viewed as a pressure tactic rather than a legitimate criminal prosecution.

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Issues: Whether criminal proceedings arising from a contractual dispute were an abuse of process and liable to be quashed in exercise of inherent powers under Section 482 of the Code of Criminal Procedure, 1973.

Analysis: The dispute arose out of a work contract containing an arbitration clause, and arbitration had already commenced. The record showed that the complainant had admitted inability to continue the work and had sought withdrawal from the contract and settlement of accounts. On these facts, the allegations were found to be predominantly civil in nature and did not disclose the essential ingredients of cheating, deception, or forgery. The continuation of the FIR and the order under Section 156(3) of the Code of Criminal Procedure, 1973 was viewed as a device to pressure the appellant in relation to the contractual dispute.

Conclusion: The criminal proceedings were an abuse of the process of court and were liable to be quashed under Section 482 of the Code of Criminal Procedure, 1973.

Final Conclusion: The contractual dispute was treated as one for civil adjudication and arbitration, and the criminal process was not permitted to continue.

Ratio Decidendi: Where the allegations arising from a contract disclose a predominantly civil dispute without the essential ingredients of a criminal offence, inherent powers may be exercised to quash criminal proceedings that amount to abuse of process.

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