Madras High Court Quashes Forgery Case Against Mahindra World City After Victims Accept Alternate Land In Settlement

"Under such circumstances, no useful purpose will be served in keeping the proceedings pending, even though, the offences involved are not compoundable in nature," Madras High Court, in a significant order dated April 27, 2026, quashed criminal proceedings for forgery and conspiracy against Mahindra World City Developers Limited after the legal heirs of the original complainant agreed to a settlement.

Justice M. Nirmal Kumar, while exercising inherent powers under Section 528 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), observed that continuing the trial would be a futile exercise since the parties had resolved the dispute by exchanging the contested five-cent plot for three alternate properties.

The dispute originated from a 2013 complaint by one Raji, who alleged that his ancestral land in Veerapuram had been usurped through forged documents by several individuals (A1 to A6) and eventually sold to Mahindra World City Developers (A9) to form part of an SEZ. The petitioner, a joint venture with the Government of Tamil Nadu (TIDCO), maintained it was a bona fide purchaser that had developed a world-class industrial park on the site. Following the death of the original complainant in 2019, his legal heirs were impleaded as respondents in the quash petition.

The primary question before the court was whether criminal proceedings involving non-compoundable offences under Sections 465, 468, and 471 of the IPC could be quashed based on a private settlement. The court also considered whether the provision of alternate land by a corporate accused to the victims constituted a valid ground for invoking inherent jurisdiction to terminate a long-standing property-related criminal dispute.

Chain of Alleged Forgery and Corporate Acquisition

The Court noted the prosecution's case that the property, originally belonging to the complainant’s forefathers, was allegedly forged into a title chain by adjacent landowners before being sold to the petitioner. The investigation had led to a charge sheet against nine persons, including the corporate developer, for criminal conspiracy and the use of forged documents.

"The petitioner/A9 viz., M/s.Mahindra World City Developers Limited was in the process of setting up Industrial Park and acquired large extent of land, including the subject property, for valid consideration," the Court noted.

Settlement Reached Through Alternate Property Allocation

During the pendency of the petition, the legal heirs of the deceased complainant (Respondents 2 to 8) informed the court that they had reached an amicable resolution with the developer. The Court observed that instead of pursuing the five-cent disputed plot, the heirs agreed to accept three alternate properties settled in their favor.

Compromise Between Parties Renders Trial Unnecessary

The Court took cognizance of the Memorandum of Compromise and the fact that the documents for the alternate properties had already been submitted for registration. The identities of the legal heirs were verified in person by the Special Sub-Inspector of Police, and they confirmed their willingness to withdraw the prosecution in light of the settlement.

"This Court had interaction with R2 to R8, all who confirmed the settlement arrived with the petitioner by getting alternate property in lieu of the disputed property," the Bench observed.

Quashing of Non-Compoundable Offences Under Inherent Powers

The Bench addressed the legal hurdle of the offences being non-compoundable under the IPC. Referring to the Supreme Court's guidelines in Parbathbhai Aahir @ Parbathbhai v. State of Gujarat and State of Madhya Pradesh v. Dhruv Gujarat, the Court held that inherent powers can be used to quash proceedings even for non-compoundable offences if the dispute is essentially private or civil in nature and a settlement has been reached.

Court Exercises Caution in Invoking Section 528 BNSS

Justice Nirmal Kumar emphasized that the Court must exercise due caution while quashing such proceedings. However, in this instance, the Court found that the settlement was genuine and that the "ends of justice" would be better served by giving effect to the compromise rather than forcing a trial where the chance of conviction was remote due to the settlement.

"In the light of the guidelines given by the Hon'ble Supreme Court and after exercising due caution, this Court in exercise of its jurisdiction under Section 482 Cr.P.C. (Section 528 BNSS), is inclined to quash the proceedings," the Court held.

The Court allowed the petition and quashed the proceedings in C.C. No. 251 of 2020 pending before the Judicial Magistrate No. II, Chengalpet. Crucially, the Court extended the benefit of the quashment not only to Mahindra World City Developers but also to all other co-accused who were similarly placed in the alleged transaction chain.

The ruling reinforces the principle that in property disputes where the criminal element is secondary to the civil grievance, a robust settlement—such as providing alternate land—can justify the quashing of non-compoundable criminal charges. The decision effectively brings to a close a decade-long litigation involving a major industrial SEZ.

Date of Decision: 27 April 2026