Court held that breaches of contract, if primarily civil in nature, do not implicate criminal liability unless fraudulent intent is evident from the outset.

1. All these petitions have been heard analogously, as they arise out of First Information Report (FIR) / crime No. 254/2010 for offences under S.406 & S.420 read with S.34 of the Indian Penal Code (for short 'the IPC - ) at Police Station Chakradhar Nagar, District Raigarh. During pendency of these petitions, the Police has filed the charge - sheet on 15-12-2014 for offence under S.406, S.420, S.467, S.468, S.471 & S.120 - B of the IPC.

2. In WP (Cri.) Nos. 1360 & 1181 of 2011, the accused / petitioners have prayed for quashment of the said FIR and all the proceedings emanating therefrom including the investigation and warrants; whereas in W.P. (Cri.) No. 2916/2011 the accused / petitioner has sought for quashment of the entire proceedings drawn by the respondent in its file in the said crime number and in Cri. M.P. No. 764/2010 the accused / petitioners have prayed for quashment of the FIR. Since all the petitioners are accused in the said common crime number / FIR, the petitions are being disposed of by this common order.

3. The subject FIR was registered on 28-7-2010 for offences under S.406 & S.420 read with S.34 of the IPC naming the following six accused persons : -
* Sureshchandra Goyal, B - 45, Maharani Bagh, New Delhi (Petitioner No. 1 in Cri. M.P. No. 764/2010).
* R. C. Venkata Sarvesam Sastry Tejomurty, 2-23122119, Durgabai Deshmukh Colony. Bagh Amarpot, Hyderabad (Petitioner in W.P. (Cri) No. 1181/2011).
* Gulshan Kumar Balaya, 960 Sector - 4, Arban Estate, Gurgaon (Haryana) (Petitioner No. 2 in Cri. M.P. No. 764/2010).
* Prakash Agarwal, 5, Raja Santosh Road, Alipore, Kolkata (Petitioner in Cri. W.P. (Cri) No.1360/2011).
* M. J. Pandya, 702, 7th Floor, Little Star, Ramkrishna Santkunj, West Mumbai.
* Ved Prakash Gupta, 43, Gopal Ram Nagar Extension Delhi (Petitioner No. 3 in Cri. M.P. No. 764/2010, but later on deleted from the array of cause title on 26-11-2010).
S. No. i is the Chairman and S. Nos. ii to vi are the Directors of Goyal MG Gases Pvt. Lte. (for short 'MG Gases' ).

4. In the FIR, the Law Officer of the complainant Ind Synergy Limited (for short 'Ind Synergy' ), has alleged that the Chairman and Directors of MG Cases entered into a written agreement with the complainant company for installation of Air Separation Unit (for short 'ASU' ) for supply of oxygen and nitrogen gases and against the terms of the contract fraudulently obtained payment of Rs. 78.00 lacs and committed breach of trust. Under the terms of agreement, MG Gases was to erect the ASU plant by making available the drawing & design to Ind Synergy. The accused persons were provided 6400 square meter of land and also made available all other facilities. As per clause 9 of the agreement, the accused persons were liable to commence supply of gases within six months from the completion of civil work whereas under clause 10, time was the essence of the contract. The accused persons mala fidely and to avoid the liability of supply of gases raised the plea that civil work is not completed, and as such, they failed to supply gases. One of the necessary machinery of the ASU plant, the cold box was brought by the accused persons in the month of December, 2009; and was parked in a trailer at village Loing, District Raigarh; and was brought to the plant premises in April, 2010. The delay was deliberate on the part of the accused persons on the pretext that civil work is not complete. On inspection of the machinery, the cold box was found to be 60 years old and the complainant company got opinion that the cold box has been rejected by some industrial unit in the Burnpur district of West Bengal. The accused persons, thus, committed fraud with an intention to cheat the complainant knowing fully well that the cold box was not capable of producing gas.

5. According to the FIR, the accused persons falsely and with bad intention assured the complainant company that they are capable of erecting ASU to produce gases; made the complainant company to believe them and