IMPORTANT POINT
A mere loan dispute does not amount to criminal breach of trust or cheating without evidence of entrustment or fraudulent intent.

ORDER :

1. In this petition under Section 482 Cr.P.C., the petitioner has sought quashing of FIR No. 76/2018 dated 23.02.2018 under Sections 420, 406 IPC, registered at Police Station Sardarshahar, District Churu and the proceedings, if any, arising out therefrom.

2. The facts may be briefly noticed.

3. That on 23.02.2018, complainant Madan Lal Pareek S/o Jagdish Prasad Pareek had submitted a written report at Sardarsahar (District Churu) Police Station to the effect that he had lent a total sum of Rs. 70,00,000 to the petitioner-accused between 01.04.2013 and 28.06.2014. This amount was lent at the interest rate applicable in banks. The petitioner has now refused to repay the amount; therefore, it was requested that money of complainant be returned back to him.

4. Learned counsel appearing on behalf of the petitioner has submitted that bare perusal of the first information report would reveal that the allegations as contained in the complaint are purely civil in nature and the requisite averments so as to make out a case of cheating and criminal breach of trust are absent. Hence, it does not disclose the commission of the alleged offence. Moreover, instead of filing a money recovery civil suit, complainant has lodged the present F.I.R. and has attempted to give the cloak of a criminal offence to the present dispute which is purely civil in nature, just to harass the petitioner and for recovery of a time barred loan amount. According to him, it was a fit case for quashing of the FIR and all proceedings pursuant thereto.

5. Learned Public prosecutor assisted by learned counsel appearing on behalf of the complainant has opposed this prayer and argued that a clear case under Section 406 and 420 of the IPC was made out against the petitioner as borne out by the material collected and indicated. Learned counsel for the complainant has supported the impugned FIR and submitted that from the allegations levelled in the FIR, offence under Sections 406 and 420 is prima facie made out against petitioner-accused. Petitioner took a loan of a huge amount and still he failed to make payment, therefore it is evident that petitioner was not intending to make payment from beginning. It is his contention that if the matter is allowed to proceed, it is certain that it would lead to conviction of the petitioner under Section 406 and 420 of the IPC. Therefore, this Court ought not to exercise its jurisdiction under Section 482 Cr.P.C. and quash the FIR.

6. I have considered the arguments advanced by the parties.

7. Before going into rival contentions, it would be appropriate to have a look at the first information report filed by Respondent No. 2 in the police station, which formed the foundation for the police for registration of the FIR. In sum and substance, what was alleged in the said complaint was as follows:-

8. In view of above facts of F.I.R, I am not in agreement with the submissions made by Ms. Priyanka Borana and Public Prosecutor that if the matter is allowed to proceed, it would certainly lead to conviction of the petitioner for the offence punishable under Sections 406 and 420 of the IPC.

9. The sole foundation of the above stated FIR appears to be recovery of money advanced as loan. There is no dispute that the FIR referred to above, came to be registered at the instance of the complainant on account of the alleged non-payment of a loan amount taken by the petitioner from the complainant.

10. Section 406 IPC relates to the punishment provided for criminal breach of trust which is explained in Section 405 IPC. It is well settled that before there can be criminal breach of trust, there must be entrustment. The law clearly recognizes a difference between simple advancement/investment of money and entrustment of money. A mere breach of a promise, agreement or contract does not, ipso facto, constitute the offence of the criminal breach of trust contained in Section 405 Indian Penal Code without there being a clear case of entrustment.

11. In a case