A mere breach of contract does not constitute an offence under Section 420 IPC unless fraudulent intent is established from the outset.

JUDGMENT :

DINESH KUMAR SHARMA, J.

A. Preface

1. The present petition has been filed under section 482 Cr.P.C. seeking to set aside the order dated 02.08.2022 passed by the Court of Ld. ASJ- 06, Patiala House Courts, New Delhi, in criminal revision petition bearing no. 264/2021 titled 'Shantanu Prakash v. State & Anr.’

2. A revision petition was filed by Mr Shantanu Prakash/ Respondent No.2 before the Ld. ASJ seeking to set aside the order dated 22.05.2019, passed in CC no. 11448/18 by the Ld. CMM, Patiala House Courts whereby Respondent No. 2, along with Educomp Solutions Limited and associated persons, were summoned for the offence punishable under Sections 420/34 IPC.

3. Ld. ASJ, while dismissing the summoning order dated 22.05.2019 of Ld. CMM, opined that the allegations, even if accepted at face value, did not amount to a prima facie case of cheating under Section 420 IPC.

B. Factual Matrix

4. Petitioner is a listed company headquartered in Singapore. A complaint was filed on behalf of the petitioner company under Section 200 Cr.P.C. before the Ld. CMM, Patiala Courts, New Delhi District, alleging a concerted scheme by Educomp Solutions Limited (Educomp), led by its Chairman and Managing Director, Sh. Shantanu Prakash (Respondent No. 2) and other associated persons to defraud the petitioner and obstruct the lawful transfer of control over the joint venture entity, JRRES. It was alleged that the accused persons by their acts caused wrongful loss to the Complainant to tune of over Rs. 100 crores and wrongful gain to themselves and have committed offences punishable u/s 403/406/420 r/w 34/120B IPC.

5. Briefly stated facts, as alleged in the complaint, are that in October 2007, Respondent No. 2, Mr. Shantanu Prakash, who heads and controls Educomp Group of Companies., along with other accused persons, approached the Raffles Group seeking collaboration/investments in educational ventures in India. It has been alleged that Respondent No. 2 and his associates represented themselves as a leading educational company in India, with over 13 years of government connections, professional expertise and financial wherewithal in delivering large-scale educational projects. Believing these representations, the Raffles Group through the petitioner company agreed to enter into a Master Joint Venture Agreement (JVA) on 16.05.2008. As part of the joint venture, two companies were incorporated:

1. Educomp-Raffles Higher Education Ltd. (ERHEL) with equal shareholding (50%) by both parties, and

2. Millennium Infra Developers Ltd. (MIDL), a subsidiary of ERHEL

6. One of the key ventures proposed by the accused persons allegedly was the establishment of a Management and Technical University in India, using Jai Radha Raman Education Society (JRRES) as the operating entity. JRRES is a society registered in Delhi in 2004 and had 44 acres of leased land from the Greater Noida Industrial Development Authority vide lease deed dated 18.06.2006. It was allegedly informed to the petitioner by Respondent no. 2 that they had gotten involved in JRRES in 2006 and further allegedly represented that his associates were made members in 2008 and therefore JRRES was under their control and could be used to build the proposed university. It has been alleged that Respondent no. 2 repeatedly represented to the petitioner company that he had control of the affairs of JRRES directly as well as indirectly through his associates.

7. It has been alleged that Educomp and Respondent No. 2 enticed the petitioner to invest substantial funds into a joint venture, misrepresenting their control over JRRES and promising smooth operations with equal say in the affairs of the Society by both parties. Loans were also provided to JRRES under favourable terms through a Loan Agreement dated 01.07.2009, with no interest charged for the first y