The judgment established that the allegations did not demonstrate fraudulent or dishonest intention at the beginning of the transaction, distinguishing between breach of contract and the offence of cheating.

JUDGMENT

Jasmeet Singh, J. The present petitions have been filed by the petitioners seeking quashing of FIR No. 147/2020, dated 05.10.2020 under sections 406/420/120B IPC, registered at P.S. Economic Offences Wing.

2. The petitioners in CRL. M.C 1757/2021and W.P. (CRL) 1593/2021 areMr. Arun Kumar and Mr. Amit Mavi respectively.The respondents are the same in both the petitions.

3. Brief facts of the case are-

i. Two companies, namely Alisa Infratech Pvt. Ltd and and Baya Weaver Ltd (hereinafter called the accused companies) were jointly developing a project on land being Plot No. C3-A, measuring 18,898 sq. mtrs falling in Khasra No. 554M, 577M, 578M 579M (partly), 576 (partly) of Village Gheja, Tilastabad, Sector 129, Noida, Gautam Budha Nagar, Uttar Pradesh, under the name of "Oh My God". Mr. Arun Kumar was the Director of Alisa Infratech Pvt Ltd, while Mr. Amit Mavi was the main shareholder in both the accused companies. The petitioners were to develop the aforesaid project but by 2019, despite their best efforts,theywere only able to develop 5% of the project and took a loan from IIFL, which they were unable to repay. As a result, they approached respondent No.2 (Saya Cementation Limited), to take over the project and develop it further. The petitioners proposed acquiring of the accused companies through a Share Purchase Agreement (herein referred to as "SPA") with respondent No.2.

ii. Two Share Purchase Agreements (SPA's) were executed by respondent No.2 with the petitioners on 30.03.2020, whereby the respondent No.2 acquired all the equity shares of the accused companies and assumed responsibility for the project's construction and development and all the liabilities of the accused companies.Accordingly, Rs.5 lakh was to be paid for Baya Weaver Ltd and Rs.3.13 crore was to be paid for Alisa Infratech Pvt. Ltd. The total valuation of equity shares of the accused companies was assessed at Rs.3,13,34,100/- The relevant terms of the SPA agreement read as under:

"Article 2.2-Purchase and Sale of the Sale Securities

Simultaneously with the payment of the Consideration by the Buyers in the manner specified in Article 2.3.2 herein below, the Sale Securities shall be transferred in favour of the Buyers in the manner specified in Article 7 herein below. Upon the transfer of all the Sale Securities, the Buyer shall collectively hold all 100% of the total issued and paid up share capital of the company. The shareholding pattern of the company post transfer of the Sale Securities is set forth in Schedule B of this agreement

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2.3 Purchase Price

2.3.1. The total consideration for purchase of the Sale Securities shall be INR 31,334,100 (Rupees Three Crores Thirteen Lakhs Thirty Four Thousand One Hundred Only) (the "Consideration"). The Consideration shall be paid by Buyers to the Sellers in the manner as specified in Article

2.3.2 of this Agreement.

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Article 7.1.1 (ii)-Remittance of Consideration-The Sellers shall hand over to the Buyers Transfer Document representing the Sale Securities along with the share transfer slips and other required documents for credit of share transfer in Demat form in favour of the Buyers with respect to the Sale Securities and other undertakings, documents as mentioned Annexure 8 of this Agreement."

iii. Another important term was that the respondent No.2 was required to place a sum of Rs.11,58,51,365 crores [(hereinafter referred to as Rs.11.58 (approx.)] in a separate Current Account No. 1201030000000010 inNainital Bank, where the representative of IIFL, being Mr. Anurag Solanki would be a co-signatory along with Mr. Amit Mavi for settling the clients/consumers of the accused companies.

iv. Respondent No.2 claims that despite having fulfilled their obligations under the SPA by paying the consideration for shares and settling the debts of several creditors amounting to approximately Rs.300 crores, the petitioners have allegedly refused to provide the documents of the accused companies as required