Criminal prosecution for breach of contract requires evidence of fraudulent intent from the inception; mere allegations of non-fulfillment do not suffice to establish offences under IPC sections related to cheating and misappropriation.

JUDGMENT :

Anil Kumar Choudhary, J.

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, 1973 with the prayer to quash the entire criminal proceedings including the order taking cognizance dated 07.06.2023 passed by the learned Sub Divisional Judicial Magistrate, Seraikella-Kharsawan in connection with Complaint Case No.596 of 2022 whereby and where under the learned Magistrate has found prima facie case for the offences punishable under Sections 406, 420, 504, 506 of the Indian Penal Code.

3. The allegation against the petitioners is that the complainant was sold a land inter alia in the presence of the petitioner No.1 and the petitioner No.1 disclosed that the said land stands recorded in the name of his father and it was agreed to between the parties that the consideration amount of the said land would be Rs.2,00,000/-. Then both the petitioners along with the co-accused persons, came to the house of the complainant and showed him the land. The complainant purchased the land on 16.05.2012 on paying Rs.2,00,000/- but after eight years in 2020, he came to know that the petitioners have sold the land other than the one showed to the complainant. Two of the accused did not allow the demarcation of the land by the Government Amin and threatened the complainant. The complainant earlier lodged R.I.T. P.S. Case No.51 of 2021 against the seller of the land namely Chhavi Ram Verma-who is the father of the petitioner no.1 and husband of the petitioner no.2 but after death of the said Chhavi Ram Verma, Final Report was submitted in that case. The land which has been sold to the complainant, is under the possession of Shekh Dilawar and Tawarak Ali. The learned Sub Divisional Judicial Magistrate, Seraikella- Kharsawan on the basis of the complaint, the statement of the complainant on solemn affirmation and the documents available in the record, found prima facie case; as already indicated above.

4. Learned counsel for the petitioner relies 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 0 Supreme (SC) 517 and submits that in paragraph-13 thereof, it has been reiterated by the Hon’ble Supreme Court of India that 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. It is next submitted that the present case is at best a case of breach of contract, hence, initiation of the criminal proceeding in the absence of any allegation of fraudulent or dishonest intention of the petitioners, is not sustainable in law.

5. Learned counsel for the petitioners next relies upon the judgment of the Hon’ble Supreme Court of India in the case of Uma Shankar Gopalika vs. State of Bihar & Anr. reported in (2005) 10 SCC 336, paragraph-6 of which reads as under :-

“6. Xxxx xxxx xxxx 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.” (Empha