NRI Relative Refuses to Return Property Refund — Legal Recourse Under Indian Law

One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.

Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.

TL;DR: An NRI paid his relative as an agent to buy land near an upcoming airport. The seller had already sold the plot to someone else and refunded the full amount plus a goodwill sum to the agent. The agent pocketed the ₹21 lakh and disappeared. Under Indian law, this is both a criminal offence (criminal breach of trust under Section 316 BNS) and a civil claim for money recovery. The NRI can file a complaint in the jurisdiction where the money was handed over or where the agent resides. A police complaint can be compelled through a Magistrate's order under Section 175(3) BNSS if the police refuse to register an FIR.

It was early 2021 when Mr. Arjun Mehta, a software engineer based in California, decided to invest in property near the upcoming airport in Nagpur. He had been living in the US for over a decade, and his last Indian address was in the HSR Layout area of Bengaluru. Mr. Mehta's maternal cousin's son, Mr. Vikram Joshi, approached him with a promising deal: a 500-square-yard residential plot roughly 15 km from the proposed airport terminal. On 15 January 2021, Mr. Mehta transferred ₹20 lakh to Mr. Joshi as a booking token via NEFT from his US-based account to Mr. Joshi's HDFC Bank account in Bengaluru. The balance was to be paid at registration.

When Mr. Mehta landed in India on 10 March 2021 and met the actual landowner directly, he was stunned. The landowner informed him that the plot had already been sold to a third party in December 2020. Worse, the landowner had refunded the entire ₹20 lakh plus an additional ₹1 lakh as a goodwill gesture — a total of ₹21 lakh — to Mr. Joshi back in January 2021. Confronted, Mr. Joshi first denied receiving any money, then claimed he needed a few days to sort things out. That was over four years ago. Despite pressure from mutual relatives and his own family, Mr. Joshi has not returned a single rupee and has cut off all communication entirely.

Mr. Mehta first tried the traditional route through family elders. That failed. He then approached the HSR Layout police station in Bengaluru — the jurisdiction of his last known Indian address. The police refused to register an FIR, saying the transaction happened outside their local limits and that he should approach a civil court. That's when Mr. Mehta reached out to the Chamber of Advocate Sudhir Rao. The office of Advocate Sudhir Rao identified the case as a classic instance of criminal breach of trust by an agent — a distinct legal category with specific procedural advantages. By filing a private complaint under Section 175(3) BNSS before the Chief Metropolitan Magistrate in Bengaluru, the office secured a direction to the police to register an FIR under Section 316 BNS. The matter is currently at the investigation stage, with a civil suit for recovery also filed simultaneously to ensure both criminal pressure and civil recovery run in parallel.

Key Facts of the Case

• Agent-Beneficiary Relationship: Mr. Joshi acted as Mr. Mehta's agent for the land purchase, not as a seller. This created a fiduciary relationship.
• Amount Handed Over: ₹20 lakh was transferred as a booking token on 15 January 2021. The seller later refunded ₹21 lakh directly to the agent.
• Entirely Different Conduct: Mr. Joshi did not return the money, denied receipt, and then disappeared. This went beyond a civil breach to a criminal act.
• Police Refusal: The local police refused to file an FIR citing territorial jurisdiction issues and the civil nature of the dispute.
• Private Complaint Filed: A complaint under Section 175(3) BNSS before the Chief Metropolitan Magistrate, Bengaluru, succeeded in compelling the police to register an FIR under Section 316 BNS (criminal breach of trust).
• Dual Remedy Approached: Both a criminal complaint and a civil suit for recovery of ₹21 lakh were filed simultaneously, ensuring no remedy was lost.

The Direct Legal Answer

1. Which jurisdiction or police station has authority over this case?

Jurisdiction in a criminal case of this type can lie in multiple places. Under the Bharatiya Nagarik Suraksha Sanhita, 2023, an offence may be inquired into or tried by a court within whose local jurisdiction the act was done or the consequence ensued. Here, the money was transferred from Mr. Mehta's Bengaluru-linked account, and the agent resides in Bengaluru. Therefore, the Bengaluru police have jurisdiction. The location of the plot (near Nagpur) is less relevant since the plot was never in dispute — only the misappropriation of funds is. Your registered address in Ahmedabad does not determine jurisdiction for this crime. The key is where the agent received the money and where the breach occurred.

2. What is the right legal route: civil recovery, criminal complaint, or both?

Both, simultaneously. Filing a civil suit alone can take years to get a decree, and then you must separately file execution proceedings. A criminal complaint under Section 316 BNS (criminal breach of trust) creates immediate police investigation, potential arrest, and immense pressure on the agent to return the money to avoid prosecution. The law allows you to pursue both remedies at once — a civil suit for recovery and a criminal complaint for punishment. The criminal case can be a powerful tool to compel settlement or payment. Do not choose one over the other. File both.

3. How can I compel the police to register an FIR when they refuse?

If the police refuse to register an FIR, your recourse is to file a private complaint under Section 175(3) BNSS before the jurisdictional Magistrate. The Magistrate has the power to order an investigation under Section 175(4) BNSS or to directly take cognizance of the offence. Alternatively, you can approach the Superintendent of Police under Section 173(4) BNSS with a written complaint. If that fails, a writ petition under Article 226 of the Constitution before the High Court is a last resort. For an NRI, the private complaint route is often the fastest, especially with proper documentary evidence.

Advice in Such Cases

Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation to come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

First, collect every scrap of evidence: bank statements showing the transfer, any WhatsApp messages or emails with the agent, the landowner's statement about the refund, and the refund receipt. Second, do not wait for family members to resolve it — they have already tried and failed. Third, understand that this type of matter — a fiduciary misappropriation by an agent — involves nuanced procedural strategies. A general practitioner may not know how to frame the private complaint correctly or which sections of the BNS apply. An advocate who regularly handles NRI fraud and breach of trust cases will know how to navigate jurisdictional hurdles, get the police moving, and simultaneously file the civil suit to secure the amount.

Applicable Sections of Law

Criminal (Bharatiya Nyaya Sanhita, 2023):

• Section 316 BNS — Criminal breach of trust by an agent. This is the primary offence here, as the agent misappropriated money entrusted to him for a specific purpose (purchase of land).
• Section 318 BNS — Cheating, if the agent had dishonest intention from the beginning (though harder to prove in this case).
• Section 173(4) BNSS — Right to approach the Superintendent of Police if the station house officer refuses to register an FIR.
• Section 175(3) BNSS — Right to file a private complaint before a Magistrate to compel police investigation.

Civil:

• Section 73 of the Indian Contract Act, 1872 — Compensation for loss or damage caused by breach of contract. The agency agreement implied a duty to return the refund.
• Order 38 Rule 5 CPC — Attachment before judgment, to prevent the agent from disposing of assets during the litigation.

Punishment and Penalties

Under Section 316 BNS, criminal breach of trust by an agent is punishable with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine. The offence is cognizable (police can arrest without warrant) and non-bailable (bail is not a matter of right but at the court's discretion). It is also non-compoundable — meaning the parties cannot privately settle the criminal case and have it dismissed without court approval. The court can still permit compounding if the amount is returned and parties agree, but it is not an automatic process. The fine amount is determined by the court based on the loss suffered and the gravity of the breach.

Jurisdiction — Where to File the Case

For the criminal complaint, the jurisdiction lies with the court within whose local limits the offence was committed. Here, the money was transferred from Mr. Mehta's account in Bengaluru, and Mr. Joshi resides in Bengaluru. Therefore, the Chief Metropolitan Magistrate, Bengaluru, has territorial jurisdiction. For the civil suit, the plaintiff (Mr. Mehta) can file it either where the defendant resides (Bengaluru) or where the cause of action arose (Bengaluru, since the payment and breach occurred there). Jurisdiction matters because filing in the wrong place can result in the case being returned or dismissed, causing delay. An NRI should ensure the court has both territorial and pecuniary jurisdiction (the claim is below ₹2 crore, so a City Civil Court or District Court, not a High Court, is appropriate for civil recovery).

What if Police Refuse to File FIR?

If the police refuse to register an FIR, do not give up. The Bharatiya Nagarik Suraksha Sanhita provides clear remedies:

• Approach the Superintendent of Police (SP): Under Section 173(4) BNSS, you can send a written complaint by registered post to the SP of the district. The SP can either investigate himself or direct a subordinate to register an FIR.
• File a Private Complaint under Section 175(3) BNSS: This is the most effective remedy. You approach the jurisdictional Magistrate with a complaint, and the Magistrate can order an investigation under Section 175(4) BNSS or take cognizance directly.
• Writ Petition before High Court: As a last resort, if both the SP and Magistrate fail, you can file a writ of mandamus under Article 226 of the Constitution before the High Court, seeking a direction to the police to register an FIR.
• Document the Refusal: Always get the refusal in writing or obtain a receipt for your complaint at the police station. This becomes evidence before the Magistrate.

Rights of the Accused

Mr. Joshi, as the accused, has constitutional rights that must be respected:

• Right to Remain Silent: Under Article 20(3) of the Constitution, no person accused of an offence shall be compelled to be a witness against himself. The police cannot force him to confess.
• Right to Legal Representation: Under Article 22, he has the right to consult and be defended by a lawyer of his choice.
• Right to be Produced within 24 Hours: If arrested, he must be produced before a Magistrate within 24 hours. He cannot be kept in police custody beyond that without judicial remand.
• Right to Copy of FIR: He is entitled to a copy of the FIR and must be informed of the grounds of arrest.
• Right to Anticipatory Bail: Given the non-bailable nature of Section 316 BNS, he has the right to seek anticipatory bail under Section 482 BNSS, which the court may grant or deny based on the facts and his past conduct.

Bail Provisions

Section 316 BNS (criminal breach of trust) is a non-bailable offence. This means bail is not a matter of right but is at the discretion of the court. For the accused, the primary recourse is:

• Anticipatory Bail under Section 482 BNSS: Mr. Joshi can apply for anticipatory bail before the Sessions Court or High Court to avoid arrest. The court will consider factors like the amount misappropriated, his cooperation with the investigation, and the likelihood of him absconding or tampering with evidence.
• Regular Bail under Section 480 BNSS: If arrested, he can apply for regular bail before the Magistrate. In a case where the amount is returned and the accused has no criminal antecedents, bail may be granted on conditions.
• Bail Strategy for the Victim: The victim's advocate should oppose bail if there is a risk of the accused destroying evidence or fleeing. Non-bailable status is a significant leverage point for the victim — the threat of arrest often motivates the accused to settle the matter.

Quashing of FIR / Case

The accused can approach the High Court under Section 528 BNSS for quashing the FIR or criminal proceedings. Grounds for quashing include:

• No prima facie offence made out from the FIR.
• The dispute is purely civil in nature and criminal proceedings are an abuse of process of law.
• The parties have amicably settled the dispute and the offence is compoundable.
• The FIR is vague, malicious, or filed with malafide intentions.

In this case, quashing on the ground that it is a "civil dispute" is unlikely to succeed because criminal breach of trust by an agent is a distinct criminal offence. The High Court would examine whether there is any dishonest intention and misappropriation — both of which are clearly present here. Quashing is generally not advisable for the accused in such clear cases of misappropriation.

Limitation Period

Under the Limitation Act, 1963, a civil suit for recovery of money must be filed within three years from the date when the amount becomes due. Here, the refund was received by the agent in January 2021, and the demand for return was made in March 2021. The limitation clock started running from the date of the first demand. Mr. Mehta's case is now approximately four years old, which likely places it beyond the three-year limitation period. However, the limitation period can be extended if there is a continuing acknowledgment of liability or if the agent made promises to pay (which can be proved through messages or witnesses). Alternatively, the court may condone the delay under Section 5 of the Limitation Act if sufficient cause is shown. This is a critical issue — the victim should not delay further and must act immediately to avoid the case being time-barred.

Interim Reliefs Available

In a civil suit for recovery, the plaintiff can seek urgent interim relief to prevent the defendant from disposing of assets and frustrating the decree. The key reliefs are:

• Attachment before Judgment under Order 38 Rule 5 CPC: The court can order the attachment of Mr. Joshi's assets (bank accounts, property, etc.) if it is satisfied that he is about to dispose of his property or remove it from the court's jurisdiction with the intent to defeat the decree. The plaintiff must show a strong prima facie case and the risk of dissipation.
• Injunction under Order 39 Rules 1 and 2 CPC: A temporary injunction restraining Mr. Joshi from transferring or alienating his assets can be granted if the court finds a serious question to be tried and the balance of convenience in the plaintiff's favour.
• Appointment of a Receiver: In exceptional cases, the court may appoint a receiver to take control of the disputed amount or assets.

An NRI should apply for these reliefs at the time of filing the civil suit itself, not later. Delay in seeking interim relief can be fatal, as the defendant may sell assets and become judgment-proof.

If You Are the Victim

• Act immediately and do not delay. The limitation period for civil recovery is three years, and you are already close to or beyond it. File the case now.
• Preserve all evidence. Download bank statements, save WhatsApp chats, take screenshots of messages, and keep the landowner's statement in writing. Do not delete anything.
• File a private complaint under Section 175(3) BNSS if the police refuse to register an FIR. Do not rely solely on the police.
• Simultaneously file a civil suit for recovery with an application for attachment before judgment under Order 38 Rule 5 CPC.
• Engage an advocate who handles NRIs and breach of trust cases — the procedural nuances and jurisdictional issues require experience a general practitioner may not possess.

Documents You Must Keep Ready

• Copy of your passport and visa (to prove NRI status and residency)
• Bank statements showing the NEFT/RTGS transfer of ₹20 lakh to the agent's account
• All WhatsApp, email, or text message exchanges with the agent regarding the land deal and the refund
• The landowner's written statement or affidavit confirming the refund to the agent
• Any proof of the agent's acknowledgment or promises to return the money
• Your Aadhaar card or any address proof for the jurisdiction where you are filing
• PAN card and any previous correspondence with the police (if any)
• List of witnesses (relatives, family members who were involved in the pressure campaign)

What Evidence Is Required?

• Primary Evidence: Bank statements showing the transfer of funds to the agent. This is direct proof of the entrustment of money.
• Documentary Evidence: Any written agreement, MoU, or even a WhatsApp message where the agent acknowledges receiving the money and the purpose of the purchase.
• Oral Evidence of the Landowner: The landowner's testimony that he refunded ₹21 lakh to the agent. This is crucial to establish that the agent received money that never belonged to him.
• Circumstantial Evidence: The agent's conduct — denying receipt, then promising to return, then disappearing — is evidence of dishonest intention.
• Correspondence with Police: The refusal of the police to register an FIR (in writing or a diary entry) is evidence of the pre-litigation stage.
• Secondary Evidence: Certified copies of bank records from the bank if the original statements are not available.

How Courts Typically Approach Such Cases

In civil suits for money recovery, courts are generally sympathetic to the plaintiff when there is clear documentary evidence of the transfer and a clear breach of trust by an agent. However, courts carefully examine whether the relationship was truly that of an agent or a joint venture. If the agent claims it was a joint investment or a loan, the plaintiff's case weakens. The court will look at the terms of the agency: was there a written agreement? Was the agent authorized to receive the refund? Who paid the goodwill amount to the agent? In this case, the fact that the landowner directly refunded the money to the agent strengthens the plaintiff's position. Courts are also mindful of limitation and will not grant a decree if the suit is time-barred. The victim's advocate should be prepared to argue the limitation issue with evidence of continuing acknowledgment.

Timeline of Legal Process

• Notice to the Agent (Optional): A legal notice is often sent before filing a suit. This can take 2-4 weeks. If the agent responds, it may settle the matter. If not, the suit is filed.
• Filing of Civil Suit: The plaint is drafted and filed in the appropriate court. The court issues summons to the defendant. This takes 1-3 months for summons to be served.
• Filing of Written Statement: The defendant must file his written statement within 30 days of summons, extendable to 90 days.
• Framing of Issues and Evidence: The court frames issues, and both sides file their evidence by way of affidavits. Cross-examination can take 6-12 months.
• Final Arguments and Judgment: Post-cross-examination, arguments are heard. Judgment typically takes 2-4 months after arguments are completed.
• Execution: Even after a decree, execution can take another 6-12 months if the defendant does not voluntarily pay. Overall timeline: 2-4 years for a civil suit in a busy metropolitan court.
• Criminal Process: FIR → Investigation (2-6 months) → Charge sheet → Cognizance → Trial (1-2 years). Criminal cases can be faster if the accused is arrested and seeks bail, as the court often pressures for settlement.

Understanding the Costs

The total cost of a matter like this varies significantly from one case to the next — it depends on the complexity of the dispute, the forum involved, the number of hearings, and the specific facts of your situation. There is no single fixed figure that applies to everyone.

A professional advocate can give you an accurate estimate only after reviewing all your facts and documents in a consultation.

Can the Matter Be Settled Out of Court?

Yes, settlement is possible and often advisable. In a criminal case under Section 316 BNS, the offence is non-compoundable, meaning it cannot be withdrawn by the parties without court permission. However, if the accused returns the full amount with interest, the court may consider compounding the case or reducing the sentence. In the civil suit, a compromise deed can be executed under Order 23 Rule 3 CPC, and the suit is decreed in terms of the compromise. Lok Adalat is also an option — both pending cases and pre-litigation matters can be referred. Mediation is another alternative under Section 89 CPC, where a mediator can facilitate a negotiated settlement. Given the family relationship, settlement is preferable to a long litigation that may permanently damage family ties. However, given the agent's history of ghosting, the victim should only agree to a settlement where the money is paid upfront or through a court-monitored process.

Common Mistakes People Make

• Waiting too long before taking legal action. The victim waited over four years thinking family pressure would work. By the time he approached a lawyer, the limitation period for civil recovery had almost expired. Delay can be fatal to your case.
• Destroying or deleting evidence. Some people delete old WhatsApp messages or emails to "clear space." These are crucial evidence. Never delete anything until the case is fully resolved.
• Confronting the accused without a lawyer. Speaking to the agent directly or through family members may result in the accused destroying evidence, transferring assets, or filing a false counter-complaint. Let your advocate handle all communication.
• Approaching a lawyer who does not regularly handle NRI fraud or breach of trust cases. This type of case involves specific procedural strategies — like filing a private complaint under Section 175(3) BNSS or attaching assets before judgment — that a general practitioner may not be familiar with. The victim's advocate must know the nuances of criminal and civil remedies running parallel, jurisdictional issues for NRIs, and how to handle police inaction. Engaging the wrong advocate can waste time, money, and even weaken your case.
• Posting about the case on social media. Public posts can be used by the accused to claim defamation or to build a case of malicious prosecution. Keep the matter confidential and only discuss it with your advocate.
• Not filing the civil suit simultaneously with the criminal complaint. Many victims focus only on the criminal case, expecting the police to recover the money. Police do not recover money — the criminal case is for punishment. You need a parallel civil suit for recovery of the amount.

FAQs People Normally Have

Can I file a case from the USA without coming to India?

Yes. You can authorize an advocate in India through a General Power of Attorney (GPA) or Special Power of Attorney (SPA). The advocate can file the complaint, appear in court, and pursue the matter on your behalf. You may need to appear for your evidence through video conferencing, which many courts now permit for NRIs. The initial consultation can also be done online.

What if the agent has already spent the money?

Even if he has spent it, a criminal case cannot be withdrawn. The court can order him to pay the amount as compensation or impose a fine. In the civil suit, the court can pass a money decree, and you can attach his assets (bank accounts, property, car) through execution proceedings. If he has no assets, recovery becomes difficult, but the criminal case still holds him accountable for the offence.

Is there a risk of a false counter-case against me?

It is possible. Some families in India file false complaints (like dowry harassment or criminal intimidation) to counter your case. To reduce this risk, ensure you have solid documentary evidence of the transaction and the agent's acknowledgment. Also, file your case first and have the court record the facts. If a false case is filed, your advocate can apply for its quashing.

How much will the entire legal process cost me?

The cost varies. Court fees in a civil suit for ₹21 lakh are approximately 3-5% of the claim amount (around ₹63,000 to ₹1,05,000). Advocate fees vary widely based on the city, experience, and complexity. An NRI should expect to spend anywhere from ₹1.5 to ₹3 lakh in total for both cases to reach a decree stage. Execution costs are additional. A consultation fee of around ₹10,000 to ₹25,000 is normal for a detailed case evaluation.

Can the accused get away by saying it's a family matter?

No. The law distinguishes between a civil family dispute and criminal breach of trust by an agent. The fact that the agent was a relative does not immunize him. The court will examine whether there was dishonest misappropriation. If the agent received money for a specific purpose and kept it, that is a criminal offence regardless of the family relationship. The police cannot refuse to register an FIR merely because the parties are related.

This article is general legal information, not legal advice. Consult a qualified advocate about your specific situation.

Advocate Sudhir Rao, Supreme Court of India