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SUPREME COURT OF INDIA
B.V. NAGARATHNA, R. MAHADEVAN, JJ.
Inder Chand Bagri - Appellant
Versus
Jagadish Prasad Bagri & Another – Respondents
Criminal Appeal No. 5000 of 2025 (Arising out of Special Leave Petition (Crl.) No.4939 of 2018)
Decided On : 24-11-2025
Indian Penal Code, 1860 – Sections 406/420/120B – Criminal Procedure Code, 1973 – Section 482 – Criminal breach of trust, cheating and conspiracy – Refusal to quash proceedings – For establishing offence of cheating, complainant/respondent No.1 was required to show that appellant-accused had fraudulent or dishonest intention at the time of making promise or representation of not fulfilling partnership agreement – Such a culpable intention right at the beginning cannot be presumed but has to be made out with cogent facts – There is clear absence of material on record to attribute any dishonest and fraudulent intention to appellant-accused at the time of creation of partnership agreement – There is no allegation in complaint indicating either expressly or impliedly any intentional deception or fraudulent/dishonest intention on part of appellant-accused right from time of formation of partnership deed – Every act of breach of trust may not result in a penal offence unless there is evidence of a manipulating act of fraudulent misappropriation of a property entrusted to him – Complainant/respondent No.1 has failed to place any material on record to show us as to how he had entrusted subject property to appellant-accused – Complaint/respondent No.1 also omits to aver as to how property, so entrusted to appellant-accused, was dishonestly misappropriated or converted for his own use, thereby committing breach of trust – There is distinction between criminal breach of trust and cheating – Complaint cannot contain both offences that are independent and distinct – Said offences cannot co-exist simultaneously in same set of facts as they are antithetical to each other – Criminal law ought not to become a platform for initiation of vindictive proceedings to settle personal scores and vendettas – Appellant-accused could not be attributed any mens rea and allegations levelled by prosecution against appellant-accused are unsustainable – Allegations of criminal intent and other allegations against appellant-accused herein have been made with a mala-fide intent – Impugned order of High Court set aside and complaint case quashed. (Paras 20, 21, 22, 23, 24, 25, 27 and 29)
Facts of the case:
Present appeal arises out of the order dated 13.02.2018 passed by High Court of Gauhati in Criminal Petition No.190 of 2015 dismissing application filed under Section 482 of Code of Criminal Procedure preferred by appellant-accused, Inder Chand Bagri and thereby refusing to quash proceedings instituted under Sections 406/420/120B of Indian Penal Code, 1860.
Findings of Court:
While complainant/respondent No.1 has made grave allegations against the appellant herein, he has failed to justify the same before this Court. Such actions would create significant divisions and distrust among people, while also placing an unnecessary strain on the judicial system, particularly criminal courts.
Result – Appeal allowed.
Certainly. Based on the provided legal document, the key legal principles and conclusions are as follows:
There is a clear distinction between criminal breach of trust and cheating; both offences cannot coexist simultaneously in the same set of facts, as they are fundamentally incompatible (!) (!) .
The initiation of criminal proceedings should not be used as a tool for vindictive purposes or to settle personal scores, especially when the allegations lack sufficient material to establish the ingredients of the offences charged (!) (!) .
To establish the offence of cheating, it must be shown that the accused had a fraudulent or dishonest intention at the time of making the promise or representation. Mere failure to fulfill a promise or contractual obligation, without evidence of fraudulent intent at the outset, does not constitute cheating (!) (!) .
For criminal breach of trust, it must be demonstrated that the accused was entrusted with property and that there was dishonest misappropriation or conversion of that property. In the absence of such evidence, the offence cannot be made out (!) (!) .
The complaint must contain cogent material to prove the ingredients of the offences. If it does not, or if the allegations are inherently improbable or made with mala fide intent, the proceedings should be quashed to prevent abuse of process (!) (!) (!) .
The existence of ongoing civil proceedings related to the same matter, especially where issues of property rights and dissolution of partnership are involved, can be relevant in assessing whether criminal proceedings are justified or are an abuse of process (!) (!) .
The Court emphasizes that criminal proceedings should not be continued when they are based on allegations that do not prima facie constitute an offence, are time-barred, or are motivated by ulterior or mala fide motives. In such cases, the proceedings should be quashed to prevent undue harassment (!) (!) (!) .
The Court also highlights the importance of exercising inherent jurisdiction to prevent misuse of criminal law for personal vendettas or to cause undue harassment, especially when the evidence does not support the allegations (!) (!) .
In the specific case, the Court found that the allegations of dishonest intention and criminal breach of trust were not substantiated by material evidence and that the criminal proceedings were initiated with mala fide intent. Therefore, the proceedings were quashed, and the appeal was allowed (!) (!) .
In summary, the legal approach underscores the necessity of establishing clear, cogent evidence of fraudulent or dishonest intent for offences like cheating and criminal breach of trust. It also stresses that criminal proceedings should be carefully scrutinized to prevent abuse, particularly when civil remedies are available and the allegations lack prima facie merit.
JUDGMENT :
B.V. NAGARATHNA, J.
Leave granted.
2. This appeal arises out of the order dated 13.02.2018 passed by the High Court of Gauhati in Criminal Petition No.190 of 2015 dismissing the application filed under Section 482 of the Code of Criminal Procedure (hereinafter “CrPC” for short) preferred by the appellant-accused, Inder Chand Bagri and thereby refusing to quash the proceedings instituted under Sections 406/420/120B of the Indian Penal Code, 1860 (for short, “IPC”) arising out of the Complaint Case C.R.No.3230c of 2013 dated 19.09.2013 before the Court of Chief Judicial Magistrate, Kamrup, Gauhati that was filed by Jagadish Prasad Bagri, the complainant/respondent No.1.
3. Briefly stated, the facts of the case are that the appellant- accused along with four other individuals namely Bhagwandas Bagri, Ramkishan Bagri, Shyamsundar Bagri and Jagdish Prasad Bagri (complaint/respondent No.1) resolved to constitute a partnership firm vide partnership deed dated 01.10.1976 in the name and style of ‘INDRACHAND BAGRI AND BROTHERS’ (hereinafter referred to as “firm”). The aim of said partnership firm was to carry on business of construction of warehouses and godowns and subsequently letting them out to third parties. As per the terms of the said partnership deed, the appellant-accused agreed to bring into the partnership, for the purpose of business, the land owned by him situated at New Dag No.2760 of New Patta No. 455, Village Maidamgaon, Mouza Beltola, District: Kamrup, Assam (hereinafter referred to as “disputed property”). Subsequently, two godowns were constructed on the said disputed property and leased out to Food Corporation of India on 01.04.1978 and 01.06.1978 for a period of fifteen years i.e. till 01.06.1993.
4. Thereafter, the partners of the said firm decided to enter into a supplementary agreement on 03.04.1981 that was an addendum to the original partnership deed dated 01.10.1976. In the said supplementary agreement, it was decided conjointly by all the partners that the appellant-accused shall be permitted to utilise the disputed property for his individual interest. It was also mutually decided that in the event of vacancy of the godowns by the Food Corporation of India after the determination of lease deed on 01.06.1993, the said disputed property shall revert back to the appellant-accused along with all the rights, title and interest to the said property.
5. The said godowns were vacated by 1995 thereafter the partners of the said firm decided to dissolve the said partnership firm vide the dissolution deed dated 03.04.1997 w.e.f. 01.04.1997. Further it was mutually agreed upon that all the assets and liabilities of the said firm would stand transferred to the appellant- accused and the said firm would be his sole proprietary concern.
6. The complainant/respondent No.1 filed a Title Suit No.144 of 1998 for dissolution of the firm and rendition of partnership accounts before Civil Judge (Senior Division) No.1, Gauhati wherein the Court, vide order dated 08.09.2020, passed an ex- parte preliminary decree declaring that the said partnership firm is dissolved with effect from 08.09.2000 and the same shall be advertised as such in the Gazette.
7. Thereafter, on 20.06.2011, the appellant-accused executed a sale deed No.5359 of 2011 in favour of his nephew, one Ajit Kumar Bagri for the consideration of Rs.94.60 lakh and thereby transferred the said disputed property situated at New Dag No.2760 of New Patta No.455, Village Maidamgaon, Beltola, District Kamrup, Assam to him.
8. Aggrieved by the execution of the said sale deed, the complainant/respondent No.1 filed a Title Suit No.160 of 2012 before Court of Civil Judge No.1, Kamrup at Gauhati against the appellant-accused and the rest of the partners of the said firm seeking relief of setting aside of the sale deed No.5359 of 2011 dated 20.06.2011 and declaration that the said disputed property belongs to the firm and thereby permanently restraining the appellant-accused fro
None of the cases listed explicitly indicate that they have been overruled, reversed, or otherwise treated as bad law. There are no keywords such as "overruled," "reversed," "criticized," or "disapproved" present in the descriptions. Therefore, based solely on the provided information, I cannot identify any case law as definitively bad law.
Followed/Consistent Treatment:
Delhi Race Club (1940) Ltd. VS State of Uttar Pradesh - 2024 6 Supreme 257: This case discusses principles related to issuance of process, discretion exercised by Magistrates, and distinctions between criminal offences like breach of trust, cheating, and conspiracy. The language suggests it is a foundational or guiding decision, but there is no indication it has been overruled or questioned in subsequent rulings. It appears to be a standard, authoritative statement of law.
Vishal Noble Singh VS State of Uttar Pradesh - 2024 2 Supreme 446: This case emphasizes that criminal process should not be used for oblique purposes and that cases with bleak chances of conviction should be quashed. The language indicates a principle of judicial economy and fairness, but again, no indication of subsequent treatment as bad law.
Distinguished or Clarified:
Both cases seem to set out principles or guidelines rather than controversial rulings. There is no explicit evidence they have been distinguished or criticized in later decisions within the provided data.
Uncertain Cases:
Since the descriptions are brief and do not mention any subsequent treatment, it is difficult to determine whether either case has been overruled or questioned. The absence of such language suggests that their treatment remains unchallenged based on the given information.
All cases: Due to the limited information and lack of references to subsequent judicial treatment, I cannot definitively categorize any case as overruled or bad law. Their treatment status remains uncertain.
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