I.A. No. 6403 of 2026

1. Heard the parties.

2. Learned counsel for the petitioner submits that this interlocutory application has been filed for early hearing of this Criminal Miscellaneous Petition.

3. Since the hearing of this Criminal Miscellaneous Petition is taken up today, hence, this interlocutory application is disposed of being infructuous.

Cr.M.P. No.1875 of 2024

1. Heard the parties.

2. This Criminal Miscellaneous Petition has been filed invoking the jurisdiction of this Court under Section 482 of the Code of Criminal Procedure with the prayer to quash the entire criminal proceedings including the order taking cognizance dated 23.06.2023 in connection with C/1 Case No. 187 of 2021 whereby and where under the learned Judicial Magistrate-1st Class, Jamshedpur has found prima facie case for the offences punishable under Sections 406, 420 of the Indian Penal Code and passed summoning order.

3. At the outset, learned counsel for the petitioner submits that charge has not been framed in this case and the case is next fixed to 05.06.2025 for pre-charge evidence.

4. The allegation against the petitioner is that the petitioner took a friendly loan of Rs.1,50,000/- from the complainant but did not repay the same. Later on, he issued cheques which were dishonoured but the notice demanding the cheque amount returned with the report that the petitioner is not found in the given address. The complainant did not file any case in respect of dishonour of the cheque and non-payment of payment of cheque amount within the stipulated time. On the basis of the complaint, the statement of the complainant under the solemn affirmation and the statement of the inquiry witnesses, the learned Judicial Magistrate-1st Class, Jamshedpur found prima facie case for the said offences as already indicated above in the foregoing paragraph of this judgment.

5. Learned counsel for the petitioner relies upon the judgment of the Hon’ble Supreme Court of India in the case of Sripati Singh (since deceased) through his son Gaurav Singh vs. State of Jharkhand & Another reported in (2022) 18 SCC 614, the relevant portion of para-15 of which reads as under:-

                  “15. Xxxxx The mere dishonourment of the cheque cannot be construed as an act on the part of Respondent 2 with a deliberate intention to cheat and the mens rea in that regard cannot be gathered from the point the amount had been received. In the present facts and circumstances, there is no sufficient evidence to indicate the offence under Section 420 IPC is made out and therefore on that aspect, we see no reason to interfere with the conclusion reached by the High Court.” (Emphasis supplied) and submits that the mere dishonourment of the cheque cannot be construed as an act on the part of respondent No.2 with a deliberate intention to cheat and the mens rea in that regard cannot be gathered from the point the amount had been received. It is then submitted that in the present facts and circumstances, there is no sufficient evidence to indicate the offence under Section 420 of the Indian Penal Code is made out.

6. Learned counsel for the petitioner next relies upon the judgment of the Hon’ble Supreme Court of India in the case of Satishchandra Ratanlal Shah vs. State of Gujarat & Another reported in 2019 Supreme (SC) 337, para-14 of which reads as under:-

                  “14. Now coming to the charge under Section 415 punishable under Section 420 IPC. In the context of contracts, the distinction between mere breach of contract and cheating would depend upon the fraudulent inducement and mens rea. (See Hridaya Ranjan Prasad Verma v. State of Bihar [Hridaya Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168 : 2000 SCC (Cri) 786] .) In the case before us, admittedly the appellant was trapped in economic crisis and therefore, he had approached Respondent 2 to ameliorate the situation of crisis. Further, in order to recover the aforesaid amount, Respondent 2 had instituted a summary civil suit seeking recovery of the loan amount which is still pending adjudication. The mere inability of the appellant to return the loan amount cannot give rise to a criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, as it is this mens rea which is the crux of the offence. Even if all the facts in the complaint and material are taken on their face value, no such dishonest representation or inducement could be found or inferred.” (Emphasis supplied) and submits that it has been held by the Hon’ble Supreme Court of India that the mere inability of the accused to return the loan amount cannot give rise to a criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, as it is the mens rea which is the crux of the offence.

7. Learned counsel for the petitioner further submits that this is a case of mere inability of the complainant to pay friendly loan taken which do not constitute any of the offences. Hence, it is submitted that the prayer as prayed for in this Criminal Miscellaneous Petition be allowed.

8. Learned Public Prosecutor 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 this Criminal Miscellaneous Petition and submit that the allegations made in the complaint, the statement of the complainant under the solemn affirmation and the statement of the inquiry witnesses are sufficient to constitute both the offences in respect of which the prima facie case has been found out by the learned Judicial Magistrate-1st Class, Jamshedpur. Hence, it is submitted that this Criminal Miscellaneous Petition, being without any merit, be dismissed.

9. 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 it is a settled principle of law as has been held by 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 No.6 of which reads as under:-

                  ”6. Xxxxx 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)

                  that in order to constitute the offence of cheating, the accused person must play deception since very inception and if the intention to cheat has developed later on, the same cannot amount to cheating

10. Now coming to the facts of the case, there is absolutely no allegation against the petitioner of playing deception since the beginning of the transaction between the parties. Under such circumstances, this Court has no hesitation in holding that even if the entire allegations made against the petitioner are considered to be true in their entirety, still the offence punishable under Section 420 of the Indian Penal Code is not made out against the petitioner.

11. So far as the offence punishable under Section 406 of the Indian Penal Code is concerned, the payment of money as a loan to a person cannot be termed as an entrustment as the word ‘entrustment’ has been used in Section 405 of the Indian Penal Code. In the absence of any entrustment or any allegation of dishonest misappropriation of the entrusted property by the petitioner, this Court is of the considered view that even if the entire allegations made against the petitioner are considered to be true in their entirety, still the offence punishable under Section 406 of the Indian Penal Code is not made out against the petitioner.

12. In view of the discussions made above, as neither the offence punishable under Section 406 of the Indian Penal Code nor the offence punishable under Section 420 of the Indian Penal Code is made out against the petitioner, the continuation of the criminal proceeding against the petitioner will amount to abuse of process of law. Therefore, this is a fit case where the entire criminal proceedings including the order taking cognizance dated 23.06.2023 passed by the learned Judicial Magistrate-1st Class, Jamshedpur in connection with C/1 Case No. 187 of 2021, be quashed and set aside against the petitioner named above.

13. Accordingly, the entire criminal proceedings including the order taking cognizance dated 23.06.2023 passed by the learned Judicial Magistrate-1st Class, Jamshedpur in connection with C/1 Case No. 187 of 2021, is quashed and set aside against the petitioner named above.

14. In the result, this Criminal Miscellaneous Petition is allowed.