Reba Banerjee vs State Of Jharkhand

Anil Kumar Choudhary

Heard the parties.

This Criminal Miscellaneous Petition has been filed invoking the jurisdiction of this Court under Section 482 of the Code of Criminal Procedure with a prayer to quash and set aside the entire criminal proceeding arising out of Complaint Case No.3301 of 2022 including the order dated 17.11.2021 passed by learned Chief Judicial Magistrate, Ranchi whereby and where under the learned Chief Judicial Magistrate, Ranchi has found sufficient material to proceed against the petitioners for having committed the offences punishable under Sections 406/420/34 of the Indian Penal Code.

The allegation against the petitioners is that the petitioners entered into a development agreement with the complainant, took some money, but they subsequently entered into another development agreement in respect of the same plot of land and the person who entered into a subsequent agreement with the complainant, started construction of the building over the plot of land on the basis of the agreement entered into by him with the petitioners.

Learned counsel for the petitioners relies upon the judgment of this Court in the case of Vameshwar Prasad Singh & Another vs. The State of Jharkhand & Another reported in 2026: JHHC: 1679 and submits that therein this Court has relied upon the judgement of the Hon'ble Supreme Court of India in the case of Vinod Natesan vs. State of Kerala & Others reported in (2019) 2 SCC 401 wherein the Hon'ble Supreme Court of India has observed that as in that case, the dispute between the parties was a civil dispute and it was tried to be converted into a criminal dispute, therefore, the Hon'ble Supreme Court of India was of the view that the continuation of the criminal proceeding against the accused will be an abuse of process of law. It is next submitted that this is also a pure case of civil dispute relating to breach of contract and there is no criminal element in this case and a cloak of criminal case has been given deliberately by the complainant for the purpose of wreaking vengeance.

It is next submitted that in that case, this Court also relied upon the judgement of the Hon'ble Supreme Court of India in the case of Dalip Kaur & Ors. vs. Jagnar Singh & Anr. reported in (2009) 14 SCC 696, para 10 of which reads as under:-

"10. The High Court, therefore, should have posed a question as to whether any act of inducement on the part of the appellant has been raised by the second respondent and whether the appellant had an intention to cheat him from the very inception. If the dispute between the parties was essentially a civil dispute resulting from a breach of contract on the part of the appellants by non-refunding the amount of advance the same would not constitute an offence of cheating. Similar is the legal position in respect of an offence of criminal breach of trust having regard to its definition contained in Section 405 of the Penal Code. (See Ajay Mitra v. State of M.P. [(2003) 3 SCC 11 : 2003 SCC (Cri) 703])" (emphasis supplied)

wherein the Hon'ble Supreme Court of India has reiterated the settled principle of law that if the dispute between the parties was essentially a civil dispute resulting from a breach of contract on the part of the appellants by non-refunding the amount of advance, the same would not constitute the offence of cheating.

It is further submitted that in that case, this Court also relied upon the judgement of the Hon'ble Supreme Court of India in the case of Uma Shankar Gopalika vs. State of Bihar & Another reported in (2005) 10 SCC 336 paragraph-6 of which reads as under:-

"Xxxx xxxx xxxx It is well settled that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception. If the intention to cheat has developed later on, the same cannot amount to cheating. In the present case it has nowhere been stated that at the very inception there was any intention on behalf of the accused persons to cheat which is a condition precedent for an offence under Section 420 IPC."(Emphasis supplied)

wherein the Hon'ble Supreme Court of India has reiterated the settled principle of law that in order to constitute the offence of cheating, the accused must play deception since the beginning of the transaction between the parties and if the intention to cheat has developed later on, the same cannot amount to cheating.

It is then submitted that in that case, this Court also relied upon the judgement of the Hon'ble Supreme Court of India in the case of Radheyshyam & Others vs. State of Rajasthan & Another reported in 2024 SCC OnLine SC 2311, para-12 of which reads as under:-

"12.xxxx In the present case, the appellants were not entrusted with any property by respondent no. 2 - complainant. The only delivery made was of part payment towards an Agreement to Sell between the parties. The amount paid towards consideration cannot be said to have been entrusted with the appellants by respondent no. 2. Additionally, merely because the appellants are refusing to register the sale, it does not amount to misappropriation of the advance payment. Since there was no entrustment of property, the offence of misappropriation of such property and thereby criminal breach of trust cannot be said to be made out."(Emphasis supplied)

wherein it was held that the amount paid towards consideration cannot be said to have been entrusted with the accused person by the complainant and merely because the seller is refusing to register the sale, the sane does not amount to misappropriation of the advance amount paid.

Learned counsel for the petitioners further submit that the allegation against the petitioners is false and even if the allegations made against the petitioners are considered to be true in their entirety still neither the offence punishable under Section 420 of the Indian Penal Code nor the offence punishable under Section 406 of the Indian Penal Code is made out. It is next submitted that the complainant did not pay any money to the petitioners, hence, it is submitted that the prayer as prayed for by the petitioner in this Cr.M.P., be allowed.

Learned Addl.P.P. appearing for the State and the learned counsel for the opposite party No.2 on the other hand vehemently oppose the prayer of the petitioner made in the instant Cr.M.P and submit that the materials available in the record is sufficient to constitute both the offences punishable under Section 420 of the Indian Penal as well as the offence punishable under Section 406 of the Indian Penal Code. Therefore, it is submitted that this Cr.M.P., being without any merit, be dismissed.

Having heard the rival submissions made at the Bar and after carefully going through the materials available in the record, it is pertinent to mention here that the dispute between the parties is essentially a civil dispute relating to breach of contract. In view of the settled principle of law in the case of Dalip Kaur & Ors. vs. Jagnar Singh & Another (supra), this Court has no hesitation in holding that since the dispute between the parties was essentially a civil dispute relating to breach of contract by non-refunding the amount of advance even if taken by the petitioners, could not constitute the offence of cheating or the criminal breach of trust; because the same cannot be said to have been entrusted to the petitioners as the word 'entrusted' has been used in Section 405 of the Indian Penal Code.

In view of the discussions made above, this Court is of the considered view that even if the entire allegations made against the petitioners in the complaint, statement on solemn affirmation and the statement of the enquiry witnesses are considered to be true in their entirety still, neither the offence punishable under Section 420 of the Indian Penal Code nor the offence punishable under Section 406 of the Indian Penal Code is made out, hence, this Court is of the considered view that the continuation of this criminal proceeding against the petitioners will amount to abuse of process of law. Therefore, this is a fit case where the entire criminal proceeding arising out of Complaint Case No.3301 of 2022 including the order dated 17.11.2021 passed by learned Chief Judicial Magistrate, Ranchi, be quashed and set aside.

Accordingly, the entire criminal proceeding arising out of Complaint Case No.3301 of 2022 including the order dated 17.11.2021 passed by learned Chief Judicial Magistrate, Ranchi, is quashed and set aside qua the petitioners only.

In the result, this Cr.M.P., stands allowed.