Failed investigation no ground for Rs. 50-lakh compensation: HC

23/07/2026

JAMMU, Jul 22: The High Court of Jammu & Kashmir and Ladakh has held that closure of a criminal investigation for lack of sufficient admissible evidence does not, by itself, entitle persons named in an FIR to monetary compensation.
Justice Shahzad Azeem dismissed a petition filed by four Kupwara residents who had sought compensation of Rs. 50 lakh each after an investigation against them under the Narcotic Drugs and Psychotropic Substances (NDPS) Act was closed as "not admitted".
The petitioners - Javid Ahmad Lone, Raja Ikhlaq Akbar, Safeer Ahmad Gadwal and Basit Khan - had approached the High Court seeking quashing of FIR No. 11/2023 registered at Police Station Karnah under Sections 8A, 27B and 29 of the NDPS Act, besides compensation.
According to the case, police received information in January 2023 alleging that the petitioners and others were involved in trafficking narcotic drugs and psychotropic substances from across the Line of Control. It was also alleged that proceeds from the illegal trade were being invested in movable and immovable properties to conceal their illicit origin.
During the investigation, police obtained search warrants from the Executive Magistrate and seized 14 vehicles allegedly belonging to the accused. Mobile phones were also seized and sent to the Forensic Science Laboratory, while details regarding properties were sought from the Revenue and other departments.
The investigation was subsequently closed as "not admitted" after the investigating agency failed to collect sufficient admissible evidence to present a charge-sheet before the competent court.
Advocate Waseem Ramzan, appearing for the petitioners, contended that the FIR was vague and based on a concocted story. He alleged that the case had been registered with an ulterior motive to harass and extort the petitioners, particularly when no contraband was recovered.
Government Advocate Faheem Nisar Shah, representing the Union Territory, submitted that the FIR was registered on credible information and the investigation was conducted fairly and transparently. He said the petitioners were neither arrested nor subjected to harassment.
The High Court observed that registration of an FIR is mandatory where information received by police discloses commission of a cognizable offence. It found no material in the case diary to suggest that the FIR had been registered without basis or for any oblique motive.
Justice Azeem noted that the investigating officer had followed due process, including obtaining search warrants and carrying out seizures in the presence of a Magistrate.
Significantly, the court observed that had the investigating officer intended to falsely implicate or harass the petitioners, evidence could have been manipulated to file a false charge-sheet and subject them to a prolonged criminal trial.
"Instead, the investigating officer bona fidely closed the investigation when the evidence was found insufficient," the court observed, adding that the closure reflected the bona fide conduct of the investigating agency.
The High Court held that compensation under public law jurisdiction is an exceptional remedy and can be awarded only when violation of fundamental rights, mala fides or gross abuse of the legal process is clearly established.
Mere registration of an FIR followed by closure of the investigation could not be construed as a violation of the petitioners' fundamental rights, the court said.
Terming the claim for compensation "wholly misconceived", the High Court dismissed the petition as being devoid of merit.

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