The absence of dishonest intention at the inception of a transaction is crucial in determining the offences of criminal breach of trust and cheating.

JUDGMENT :

1. Heard the parties.

2. This criminal miscellaneous petition has been filed invoking the jurisdiction of this Court under Section 482 Cr.P.C. with a prayer for quashing the FIR as well as the entire criminal proceeding arising out of Bariatu P.S. Case No.79 of 2021 involving the offence punishable under Sections 406, 420 and 120B of Indian Penal Code.

3. The brief facts of the case is that the petitioners approached the informant to invest Rs.2,00,25,000/- with promise of paying 18% compound interest but cheated and committed criminal breach of trust by not paying the said amount.

4. It is submitted by the learned counsel for the petitioners by drawing attention of this Court to the supplementary affidavit dated 18.07.2023 that out of the said Rs.2,00,25,000/-, the petitioners have already paid back Rs.1,50,00,000/- as mentioned in paragraph no.3 of the said supplementary affidavit and the same remains undisputed and after that also, the petitioners have paid Rs.15,00,000/-. Relying upon the judgment of Hon’ble Supreme Court of India in the case of Murari Lal Gupta vs. Gopi Singh reported in (2005) 13 SCC 699, paragraph no. 6 of which reads as under:-

“6. We have perused the pleadings of the parties, the complaint and the orders of the learned Magistrate and the Sessions Judge. Having taken into consideration all the material made available on record by the parties and after hearing the learned counsel for the parties, we are satisfied that the criminal proceedings initiated by the respondent against the petitioner are wholly unwarranted. The complaint is an abuse of the process of the court and the proceedings are, therefore, liable to be quashed. Even if all the averments made in the complaint are taken to be correct, yet the case for prosecution under Section 420 or Section 406 of the Penal Code is not made out. The complaint does not make any averment so as to infer any fraudulent or dishonest inducement having been made by the petitioner pursuant to which the respondent parted with the money. It is not the case of the respondent that the petitioner does not have the property or that the petitioner was not competent to enter into an agreement to sell or could not have transferred title in the property to the respondent. Merely because an agreement to sell was entered into which agreement the petitioner failed to honour, it cannot be said that the petitioner has cheated the respondent. No case for prosecution under Section 420 or Section 406 IPC is made out even prima facie. The complaint filed by the respondent and that too at Madhepura against the petitioner, who is a resident of Delhi, seems to be an attempt to pressurise the petitioner for coming to terms with the respondent.” (Emphasis supplied)

It is submitted by the learned counsel for the petitioners that as there is no allegation against the petitioners of having deceived the complainant since the beginning of the transaction and more so, as substantial amount of the alleged money taken has in fact, admittedly been paid back by the petitioners to the complainant hence, the offence punishable under Sections 420 or 406 of Indian Penal Code is not made out.

5. In this respect, the learned counsel for the petitioners also relied upon the judgment of Hon’ble Supreme Court of India in the case of Sarabjit Kaur vs. State of Punjab & Anr. reported in (2023) 5 SCC 360, paragraph no.13 of which reads as under:-

“13. A breach of contract does not give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction. Merely on the allegation of failure to keep up promise will not be enough to initiate criminal proceedings. From the facts available on record, it is evident that Respondent 2 had improved his case ever since the first complaint was filed in which there were no allegations against the appellant rather it was only against the property dealers which was in subsequent complaints that the name o