Hello Mumbai City Desk:

Mumbai, June 2, 2026: In a significant ruling, the Sessions Court at Mazgaon has quashed an order of the Judicial Magistrate First Class, Kurla, which had directed the registration of an FIR against present and former members of the Managing Committee of Sunshine Infinity Co-operative Housing Society Ltd. and others.
The judgment, delivered on May 29, 2026, by Additional Sessions Judge Shri Sanjiv Prabhakar Pingle, allowed two Criminal Revision Applications and set aside the Magistrate’s order dated February 10, 2026.
The dispute originated from a complaint filed by Mr. Jayesh Shantilal Vira, who alleged that a sum of ₹40.57 lakh paid by him as corpus fund to Sunshine Infinity CHS Ltd. had not been refunded, causing financial loss. Based on the complaint, the Magistrate had directed Matunga Police Station to register an FIR.
Background of the Dispute
The matter traces its roots to the Sunshine Infinity redevelopment project, a large slum rehabilitation scheme involving 493 allottees. The project was initially undertaken by Sunshine Housing Infrastructure Pvt. Ltd. (SHIPL) and later transferred to SQ Infrastructure Pvt. Ltd. (SQIPL) through a slump-sale arrangement executed in 2018.
To revive and complete the stalled project, society members collectively contributed substantial funds. Additional contributions were later required following changes under Development Control and Promotion Regulations (DCPR) 2034, resulting in increased project costs. The project ultimately received its Occupation Certificate in March 2021.
Subsequently, the society entered into a full and final settlement with the developer, under which valuable commercial units and certain recovery rights were transferred to the society to compensate members for funds infused into the project.
Court Records Allegations of Protracted Litigation and Counter-Claims
The Sessions Court also took note of submissions made by the revision applicants regarding the history of disputes between the parties. According to the applicants, the discord dates back to 2015-16, when respondent Jayesh Shantilal Vira and his son, Pratik Vira, allegedly proposed the infusion of funds from sources that were considered unacceptable by the promoters of the Sunshine Group entities. The proposal was reportedly declined, leading to a deterioration in relations and a series of legal disputes.
The applicants further contended that Mr. Vira and his son subsequently initiated multiple proceedings before the National Company Law Tribunal (NCLT), Mumbai, against various Sunshine Group entities, their promoters, partners and directors. The Court recorded submissions that these proceedings did not ultimately succeed before the NCLT.
The revision applicants also alleged that, in March 2024, certain fraudulent documents were used in the Corporate Insolvency Resolution Process (CIRP) of SHPL, later known as Sivana Realty Pvt. Ltd. They maintained that neither they nor the other accused persons had any knowledge of, or involvement in, the alleged documents. According to their submissions, the discovery of these documents prompted them to approach the Economic Offences Wing (EOW), resulting in the registration of FIR No. 286 of 2024 at Azad Maidan Police Station.
The Court further recorded submissions that the EOW investigation culminated in a charge sheet running into approximately 5,500 pages. The applicants claimed that material collected during the investigation, including electronic communications, revealed an alleged conspiracy to initiate or revive multiple criminal proceedings against them with the objective of exerting pressure and extracting financial benefits.
The Sessions Court also recorded submissions by the revision applicants that, on January 3, 2025, the son of respondent No. 2 had filed Criminal Miscellaneous Application No. 32 of 2025 before the Judicial Magistrate First Class, 30th Court, Kurla, under Section 175(3) of the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023. The applicants contended that the complaint was devoid of merit and that the Magistrate had directed registration of an FIR without first obtaining a police report from Matunga Police Station.
According to the applicants, the complaint formed part of a broader pattern of litigation allegedly initiated by respondent No. 2 and his son against them over the years. They argued that several such proceedings were instituted without sufficient basis and were intended to exert pressure, harass the accused persons and secure monetary advantage.
The Court noted the applicants’ allegations that multiple FIRs and legal proceedings had been pursued against them, many of which were subsequently closed or failed to withstand judicial scrutiny. The applicants maintained that these actions constituted a systematic attempt to subject them to unnecessary criminal proceedings despite the absence of substantive material supporting the allegations.

Sessions Court Findings
The Sessions Court found that the Magistrate’s order suffered from serious procedural irregularities. Prior to passing the order, Matunga Police Station had submitted a detailed report concluding that the dispute was essentially civil in nature, involving settlement obligations, property rights, and financial claims rather than criminal misconduct.
The police further noted that Matunga Police Station itself may not have possessed territorial jurisdiction, as the relevant transactions and offices fell within the jurisdiction of other police stations.
Despite receiving the report, the Magistrate directed registration of the FIR without recording any reasons for rejecting the police findings. The Sessions Court observed that while a Magistrate is not bound by a police report, judicial discipline requires clear reasons to be recorded before departing from its conclusions.
Concerns Over Alteration of Order Date
The Sessions Court also expressed concern regarding allegations that the date of the impugned order had been altered without notice to the affected parties. Referring to court records and proceedings, the Court noted that such actions create serious doubts about whether the order was passed after due judicial consideration.
While refraining from making any finding regarding motive, the Court observed that changing the date of an order or judgment without notice to all concerned parties raises legitimate concerns about procedural fairness and transparency.
Civil Disputes Should Not Be Criminalised
Reiterating settled legal principles laid down by the Supreme Court, the Sessions Court emphasized that disputes arising out of contractual obligations, monetary claims, or settlement arrangements are primarily civil in nature. Criminal proceedings should not be used as a tool for coercion, harassment, or pressure in commercial and property disputes.
The Court noted that the allegations related to recovery of money and implementation of settlement terms and did not, on the face of the record, disclose criminal offences warranting police investigation.
Litigation History Highlighted
The revision applicants also pointed to a history of disputes and multiple legal proceedings between the parties. The Court recorded submissions regarding earlier litigations before various forums, including proceedings before the National Company Law Tribunal (NCLT) and criminal complaints arising from allegations of forged documents and financial misconduct.
While the Sessions Court did not adjudicate upon those allegations, it observed that the broader background of litigation reinforced the need for careful judicial scrutiny before directing criminal prosecution.
Final Order
Concluding that the Magistrate’s order was legally unsustainable, the Sessions Court allowed both Criminal Revision Applications and quashed the direction to register the FIR. The ruling underscores the importance of judicial reasoning, procedural fairness, and the distinction between civil disputes and criminal offences.
The judgment serves as a reminder that criminal law cannot be invoked as a substitute for civil remedies and that courts must exercise caution before directing registration of FIRs in matters arising from commercial or contractual disputes.

Quote from Advocate Ms. Pinaz C. Contractor :
This judgment is a significant reaffirmation of the settled legal principle that the criminal justice system cannot be permitted to become a tool for settling personal scores, exerting pressure or advancing private commercial interests. The Sessions Court has rightly intervened to correct a procedurally unsustainable order and has reinforced the safeguards that protect citizens against unwarranted criminal prosecution.
The Court has carefully examined the material placed on record, including the police report, the surrounding circumstances and the procedural irregularities that vitiated the impugned order. The judgment underscores that criminal law must be invoked only where genuine criminality is disclosed and not as a substitute for civil remedies or contractual enforcement.
The applicants had also relied upon material forming part of the investigation conducted by the Economic Offences Wing in FIR No. 286 of 2024, including electronic communications that, according to them, revealed a concerted effort to initiate multiple proceedings against the applicants. The record, in our respectful submission, demonstrated a pattern of litigation intended to harass, intimidate, and exert pressure upon the applicants rather than to seek legitimate legal redress.
Advocate Contractor also referred to a recent judgment of the National Company Law Appellate Tribunal (NCLAT) in the dispute involving Sunshine Infinity CHS Ltd. and SQ Infrastructure Pvt. Ltd., stating that the appellate tribunal had made observations concerning the conduct of Pratik Vira. She maintained that the Sessions Court’s ruling, read alongside other judicial findings, reinforces the need for courts to closely scrutinize attempts to convert civil and commercial disputes into criminal proceedings.
This decision serves as an important reminder that courts must remain vigilant against attempts to criminalise civil and commercial disputes. The distinction between civil liability and criminal culpability is fundamental to the administration of justice and must be preserved. The judgment will undoubtedly serve as a valuable precedent in preventing abuse of the criminal process and ensuring that criminal law is not weaponised for collateral purposes.

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