The presence of mens rea and intention to cheat can lead to criminal prosecution for breach of trust, even in cases arising from a contractual relationship.

J. C. S. Rawat, J.

Heard Sri K. S. Verma learned counsel for the applicants and Sri Anil Dabral learned counsel for the respondent No.4.

2. The petitioner under Section 482 Cr.P.C. was filed for quashing the chargesheet in case crime No. 4491 1996 under Section 420, 406, 506, I.P.C. pending before the Chief Judicial Magistrate, Dehradun.

3. The factual position in a nutshell is that the respondent No. 4 lodged an FIR against the applicants at police station Kotwali, Dehradun on 12.6.1996 and the same was registered as case crime No. 449/1996 under Section 420 and 406 I.P.C. It has been alleged that on 18.11.1991 the applicant no. 1 and Smt. Ram Murti W/o Jagdish Chandra made an agreement to purchasthe land situated at 20 Nasivlla. Road, Dehradun. The applicant No. 2 was the witness of this agreement dated 18.11.1991. It was agreed between the parties that the sale deed would be executed @ Rs. 3,50,000/-. Out of which, an earnest money of Rs. 1 lakh was paid to the applicant no. 1 by the respondent No. 4 on behalf of his wife. On one pretext or the other the applicants refused to execute the sale deed in favour of Smt. Ram Murti W/o Jagdish Chandra-respondent No.4. Thereafter, the matter was investigated and the Magistrate framed the charges against the applicants-accused under Section 420, 406, 506 I.P.C. Feeling aggrieved by this, the present petition has been preferred.

4. The learned counsel for the applicants contended that the dispute between the applicants and Smt. Ram Murti W/o Jagdish Chandra-respondent No.4 was purely of a civil nature arising out of contractual relationship with regard to commercial transaction. Even looking to the sworn statements and the notice, no case is made out to proceed against the applicants on the criminal side. The learned counsel for the respondent No.4 refuted the contention and contended that the respondent No.4 had ably proved before the court below that there is sufficient evidence against the applicants and the applicants had intention to cheat him. As such, the applicants had executed the agreement.

5. The learned counsel for the applicants further contended that the respondent No.4 has not paid the residuary amount of the agreement and as such the applicants did not perform their part. Therefore, the applicants are not liable for the criminal proceedings.

6. Before examining the respective contentions of the parties, I would like to discuss the legal position in this regard. Every breach of trust may not result in a penal offence of breach of trust unless there is evidence of mental act of fraudulent misappropriation. An act of breach of trust involves a civil law in respect of which the person wrongs may seek his redressal for damages in civil court, but a breach of trust with mens rea, gives a right to criminal prosecution as well. In order to constitute an offence of a criminal breach of trust the essential ingredients are:

(i) entrusting a person with property or with any dominion over property,

(ii) that person entrusted (a) dishonestly misappropriating or converting that property to his own use; or (b) dishonestly using or disposing that property or willfully suffering any other person so to do in violation (i) of any direction of law prescribing the mode in which such trust is to be discharged, (ii) of any legal contract made, touching the discharge of such trust or any legal contract, express or implied, which he has made touching the discharge of such trust, or