In a significant legal development, the Allahabad High Court has quashed the Enforcement Case Information Report (ECIR) and the two subsumed FIRs, being the predicate offense, filed against M3M India, marking a substantial victory for the real estate company. This ruling, delivered on Friday (December 20, 2024), effectively puts an end to the legal proceedings initiated against the company, affirming the court's view that the allegations lacked legal grounds and substance.

It is noteworthy that in the month of September 2024, the High Court had granted a stay on the PMLA proceedings against the group before the appellate authority. Moreover, in another highly positive development, the Trial Court has reserved orders on an application for stay of the trial proceedings and a favorable outcome is anticipated.

The two FIRs in question were registered in the year 2023, filed under sections of the Indian Penal Code (now known as Bharatiya Nyaya Sanhita), claimed that the transactions between M3M India, Indiabulls Housing Finance, and other stakeholders had caused financial harm and involved undervaluation of property assets. Based on these FIRs, the Enforcement Directorate (ED) initiated an ECIR, adding to the legal challenges faced by M3M India.

The High Court, after extensive hearings, observed that the allegations raised in the FIRs were primarily commercial disputes, better suited for resolution through civil or arbitral proceedings rather than criminal investigations. The court highlighted that the petitioners, including M3M India, had been subjected to criminal proceedings despite the existence of ongoing arbitration related to the contested transactions.

The Judges also noted that the FIRs failed to establish prima facie evidence of criminal intent, instead revealing contractual disagreements that did not warrant the invocation of criminal law. Furthermore, the court acknowledged the unexplained delay in filing the complaints, further undermining the legitimacy of the FIRs.