IMPORTANT POINT
The distinction between civil and criminal liability, emphasizing the need for fraudulent, dishonest intention to establish criminal liability.

JUDGMENT :

Heard Ms. N. Anju, learned Amicus Curiae for the petitioner. Also heard Mr. T. Ete, learned Additional Public Prosecutor for the State of Arunachal Pradesh. None appears for the respondent no. 2, despite service of notice.

2. This is an application under Section 482 of the Cr.P.C., 1973 praying for quashing of the F.I.R. registered as Nirjuli P.S. Case No. 48 of 2021 under Sections 417/420 of the IPC, 1860 read with Section 138 of Negotiable Instruments Act, 1881.

3. The case emanates from an F.I.R. lodged by the respondent no. 2, namely, Shri Nich Serbi, on 17.06.2021 before the Officer-in-Charge, Nirjuli Police Station, alleging that he had given a loan of Rs. 9,90,000/-(Rupees Nine Lakhs Ninety Thousand) only to the petitioner on 26.01.2020. The said loan was taken by the petitioner on the promise that same would be returned within a month. However, the petitioner did not repay the said loan amount. The respondent no. 2/informant had asked for return of the said loan amount. Since, the petitioner was not in a position to repay the said loan amount, they executed an agreement on 02.10.2020, wherein, she had agreed to repay the amount within 05.10.2020. Despite such agreement, the petitioner did not return the said loan amount and started avoiding the respondent no. 2. It is alleged that after much persuasion by the respondent no. 2, the accused petitioner had issued a cheque in favour of the informant for an amount of Rs. 14,00,000/- (Fourteen Lakhs). On presentation of the cheque issued by the petitioner, the cheque was returned unpaid with a reason of insufficiency of fund in the account of the accused petitioner, in other words, the cheque had bounced.

4. Pursuant to the said FIR, a case was registered as Nirjuli P.S. Case No. 48 of 2021 under Sections 417/420 of IPC, 1860 read with Section 138 of Negotiable Instruments Act, 1881 (NI Act in short).

5. Ms. N. Anju, learned Amicus Curiae for the petitioner submits that Police in exercise of Power under Section 154 of the Cr.P.C., cannot register a case for an offence under Section 138 of NI Act. Section 142 of NI Act even bars the Court from taking cognizance of offence under Section 138 except upon a complaint, in writing. Therefore, she submits that the registration of case under Section 138 of NI Act is illegal and without jurisdiction.

6. Ms. N. Anju, learned Amicus Curiae, submits that in the entire written complaint of the respondent no. 2, except for allegation that the petitioner had failed to make repayment of the loan amount on the due dates, no allegations about cheating, deceit, false representation, dishonest and fraudulent inducement are disclosed. The allegation of failure to repay the loan amount does not attract the provision of Sections 417 and 420 of the IPC and the mere fact that the petitioner no. 2 had used the expression “fake promise” in the complaint is inconsequential as the basic ingredient of cheating is missing in the F.I.R. She submits that the uncontroverted allegations even if taken in its face value do not make out any criminal offence and not to speak of any cognizable offence. She further submits that on the face of it, at best, it would give rise to a dispute purely civil in nature and for such civil dispute, the respondent no. 2 has remedy under the civil law and for disclosure of cheque, a complaint before the Magistrate under NI Act. She further submits that civil liability cannot be converted in criminal liability by giving cloak of criminal offence. The Investigating Agency without application of judicious mind has registered the Police case on the basis of allegation which clearly disclose a dispute purely civil in nature. Therefore, she prays that the FIR, registered as Nirjuli P.S. Case No. 48 of 2021 under Sections 417/420 of IPC, 1860 read with Section 138 of NI Act, against the petitioner is liable to be quashed.

7. In support of her submission, Ms. N. Anju, learned Amicus Curiae for the petitioner has placed relianc