Authority: Calcutta High Court (Hon'ble Justice Ajay Kumar Gupta)

Order Date: 05.10.2026

Case Overview

  • Petitioners: Vikas S. Rathee & Anr., residing outside the territorial jurisdiction of the Calcutta Magistrate.
  • Opposite Party No. 2: India Infoline Finance Limited (IIFL), a non‑banking financial company.
  • Developer: Pashmina Realty Private Limited (PRPL), promoter of the "Pashmina Lotus" project, Chandivali, Mumbai.
  • Background: In 2013 the petitioners entered a registered Agreement for Sale dated 08.11.2013 with PRPL for Flat No. 802, Wing ‘C’ (8th floor, 1,436 sq ft.) at a total consideration of Rs 3,35,70,000/‑.
  • Part consideration paid: Rs 16,25,718/‑ (pre‑execution) and Rs 31,52,891/‑ (on execution).
  • Balance Rs 2,87,91,391/‑ to be paid in instalments as per the agreement.
  • Subvention Scheme: PRPL claimed a tie‑up with IIFL whereby the petitioner would pay 20 % upfront and IIFL would disburse the remaining 80 % as a home loan; PRPL alone was to service interest until possession.
  • Possession was to be delivered by September 2016; clause 6.3 provided that failure to deliver would allow the petitioners to terminate the agreement and obtain a refund with 9 % simple interest.
  • PRPL defaulted on construction and possession; the petitioners raised concerns on 15.02.2016 and later sought refund.
  • On 24.06.2019 PRPL undertook to refund Rs 76,26,037/‑ to the petitioners and Rs 1,80,81,348/‑ to IIFL, but failed to honour the undertaking.
  • Petitioners issued a demand notice on 25.01.2024 to PRPL (copied to IIFL) seeking refund and clearance of the loan; PRPL did not comply.
  • A complaint was filed before MahaRERA, Bandra, Mumbai (Complaint No. CC006000000570811) against PRPL (Respondent 1) and IIFL (Respondent 2); the proceeding remains pending.
  • IIFL filed a criminal complaint before the Chief Judicial Magistrate, Calcutta on 01.10.2024 alleging offences under Sections 316(2), 318, 61(2) of the Bharatiya Nyaya Sanhita (BNS), claiming the petitioners obtained a loan of Rs 2,98,59,000/‑ on false representations and defaulted.
  • The Magistrate issued a pre‑cognizance notice (13.11.2024), took cognizance on 04.01.2025 (without complying with Section 225 BNSS), and on 07.03.2025 issued a bailable warrant of arrest for the petitioners.
  • IIFL asserted that a tripartite agreement required it to disburse Rs 1,80,81,348/‑ to PRPL; it claimed the petitioners defaulted, leading to classification of the loan as a Non‑Performing Asset on 03.01.2025 and issuance of a Show‑Cause Notice on 22.12.2025 under RBI Master Directions on Wilful Defaulters.
  • IIFL alleged outstanding dues of Rs 2,04,87,392/‑ as on 15.01.2025, rising to Rs 2,25,84,077/‑ as on 08.12.2025.
  • The petitioners contended that the loan was disbursed under a subvention scheme where PRPL bore interest liability; they argued no fraudulent intent existed and that the criminal complaint was an abuse of process to recover the loan.

Final Outcome

  • The Court held that the transaction was a tripartite arrangement with PRPL bearing the interest‑service obligation; possession was never delivered and no deed of conveyance was executed.
  • The alleged cheating under Section 318 BNS required proof of fraudulent or dishonest inducement at the time of the loan, which was absent; mere default does not satisfy the statutory ingredients.
  • Consequently, Criminal Revision Application No. CRR 1788 of 2025 (and related CRAN 2 of 2025, CRAN 3 of 2026) were allowed.
  • The criminal proceedings (Case No. CS/195772/2024) pending before the Judicial Magistrate, 16th Court, Calcutta under Section 318 BNS were quashed for the petitioners.
  • All orders dated 13.11.2024, 04.01.2025 and 07.03.2025 were set aside.
  • The case diary, if any, is to be forwarded to the learned counsel for the State; interim orders, if any, stand vacated.

Topics: Criminal Revision, Home Loan Dispute, Cheating Allegation