Thane Sessions Court Quashes Criminal Process Against Finance Company In Illegal Mira Road Flat Demolition Case

Thane, August 12, 2026: The Thane Additional Sessions Court has set aside a Magistrate’s order under which criminal process had been issued against Borivali-based Aavas Financiers Ltd in a case involving the purchase of a flat in Mira Road that was later demolished by the civic authorities after being declared illegal.

The court, presided over by Additional Sessions Judge R.S. Bhakare, allowed the revision application filed by the finance company and held that there was no prima facie material to proceed against it for offences under Sections 406 and 420 read with Section 34 of the Indian Penal Code (IPC).

“It appears that the present applicant is a financial institution and has given a housing loan to the complainant. Even the complainant has repaid a certain amount in equated monthly instalments up to June 10, 2019. It appears that the applicant has not received wrongful gain. On the contrary, there is wrongful loss of an amount of Rs 2,53,750, which they have transferred to the builder. Further, there is no averment in the complaint that there was nexus between the builder and the financial institution to cheat the complainant. Also, there are no averments in the complaint about entrusting the property with the applicant and dishonestly misappropriating and converting the same for their own use. Hence, prima facie there is no material on record against the applicant to issue process under Sections 406 and 420 of the IPC,” the order copy reads.

Flat Purchase Led To Dispute

The case arose after a complainant agreed to purchase a flat from Samarth Builders & Developers through a registered agreement dated July 30, 2014, for Rs 8.12 lakh. He subsequently obtained a housing loan from Aavas Financiers, which disbursed Rs 2,53,750 to the builder.

However, after construction, the civic authorities found the building to be illegal and demolished it. The complainant thereafter filed a criminal complaint alleging cheating and criminal breach of trust.

While examining the allegations against the finance company, Judge Bhakare observed that the complainant had alleged that the builder had represented that the development plan was approved and had introduced him to the finance company for obtaining a loan. The complainant had also stated that after he stopped paying the equated monthly instalments, the finance company allegedly harassed him.

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Court Stresses Need For Scrutiny

“Summoning an accused in a criminal case is a serious matter,” the court observed, stressing that a Magistrate must carefully examine the record and satisfy himself that prima facie material exists before issuing process.

Accordingly, the Sessions Court held that the JMFC’s March 1, 2021 order was not legal, correct or proper and set it aside. The criminal revision application filed by Aavas Financiers was consequently allowed.

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