IMPORTANT POINT
Not every breach of contract amounts to cheating or criminal breach of trust; intention of deception at the inception is crucial for such offences.

JUDGMENT :

Heard the parties.

2. This Criminal Miscellaneous Petition has been filed invoking the jurisdiction of this Court under Section 482 of the Code of Criminal Procedure with a prayer to quash the First Information Report being Gumla P.S. Case No.261 of 2022 as well as the entire criminal proceedings thereof instituted for the offences alleged to have been committed punishable under Sections 341, 323, 506, 406, 420, 34 of the Indian Penal Code; which is now pending in the court of learned Chief Judicial Magistrate, Gumla.

3. The brief facts of the case is that the petitioner No.1 entered into an agreement with the informant, as per which the petitioner took Rs.15,00,000/- as security money which was not carrying any interest and in consideration for the same the petitioner No.1 had to hand over the petrol-pump run by her to the informant on rent for four years eleven months but the petitioner No.1 neither handed over the petrol-pump nor returned the security money and the petitioner No.2 is the husband of the petitioner No.1.

4. Learned counsel for the petitioners relies upon the judgment of this Court in the case of The Sai Appliances & Others vs. The State of Jharkhand & Another passed in Cr.M.P. No.4285 of 2022 dated 14.08.2023 wherein this Court relied upon the judgment of the Hon’ble Supreme Court of India in the case of Sarabjit Kaur vs. The State of Punjab & Another reported in (2023) 5 SCC 360 paragraph-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 of the appellant was mentioned. On the first complaint, the only request was for return of the amount paid by Respondent 2. When the offence was made out on the basis of the first complaint, the second complaint was filed with improved version making allegations against the appellant as well which was not there in the earlier complaint. The entire idea seems to be to convert a civil dispute into criminal and put pressure on the appellant for return of the amount allegedly paid. The criminal courts are not meant to be used for settling scores or pressurise parties to settle civil disputes. Wherever ingredients of criminal offences are made out, criminal courts have to take cognizance. The complaint in question on the basis of which FIR was registered was filed nearly three years after the last date fixed for registration of the sale deed. Allowing the proceedings to continue would be an abuse of process of the court.”

and submits that at best the allegations made against the petitioners give rise to a breach of contract but does not give rise to the cause for criminal prosecution of cheating and criminal breach of trust and in that case, this Court also relied upon the judgment of Uma Shankar Gopalika vs. State of Bihar & Another reported in (2005) 10 SCC 336, paragraph No.6 of which reads as under :-

6. Xxxxx It is well settled that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception. If the intention to cheat has developed later on, the same cannot amount to cheating. In the present case it has nowhere been stated that at the very inception there was any intention on behalf of the accused persons to cheat which is a condition precedent for an offence under Section 420 IPC.” (Emphasis supplied)

and submits that every breach of contract would not give rise to an offence of cheating and on