ORDER

Dated this the 3^rd day of July, 2025 Petitioners are the accused in Crime No.44 of

2013 registered at the Varkala Police Station for the offence punishable under Section 420 r/w Section 34 of IPC , now pending as C.C. No.17 of 2014 on the files of the Judicial First Class Magistrate Court, Varkala.

2. The crime is registered on the allegation that the 1^st petitioner, while at Dubai, borrowed an amount of Rs.76 Lakhs from the defacto complainant by promising to return the amount or execute a deed assigning his property at Marthandam in favour of the de facto complainant. Contrary to the assurance, neither was the borrowed amount repaid nor the sale deed executed.

3. Learned Counsel for the petitioners submits that even accepting the allegations in their entirety, the offence under Section 420 is not attracted, since mere refusal to repay the borrowed amount cannot be termed as cheating. It is the further contention of the learned Counsel that even the cheques and promissory notes issued as security were never presented or utilized for realization of the amount, which indicates the falsity of the allegations. Moreover, in his 161 statement, the defacto complainant admitted that out of the total amount of Rs.76 Lakhs due, except 25 Lakhs, the balance amount was repaid. Reference is also made to Annexure III, an agreement allegedly executed between the parties, wherein the de facto complainant has acknowledged repayment of the entire amount due. Reliance is placed on the decision of the Apex Court in Manish v. State of Maharashtra and Another , [order in SLP (Criminal) No.10931 of 2022] that mere breach of promise per se cannot lead to the assumption of dishonest intention, so as to attract the offence of cheating.

4. The 3^rd respondent has not appeared, despite service of notice.

5. Learned Public Prosecutor submits that the 3^rd respondent had stated to the Police that the amounts were advanced to the 1^st accused when he was in financial doldrums, on the specific understanding that if the amount is not repaid, the 1^st petitioner’s property situated in Marthandam will be transferred to the 3^rd respondent’s name. Contrary to the promise, the petitioners refused to repay the amount or to assign the property. The 3^rd respondent also stated that he is fed up with conducting the case, though he received only Rs.20 Lakhs out of the Rs.76 Lakhs advanced and therefore not interested in proceeding against the 1^st petitioner.

6. Even accepting the allegation of the 3^rd respondent that an amount of Rs.76 Lakhs was borrowed by the petitioners, mere refusal to repay cannot lead to an inference of dishonest intention, thereby making the petitioners liable to prosecution for cheating. It is settled law that in the absence of an intention to deceive from the inception, the offence of cheating is not attracted. Indisputably, the petitioners have repaid a portion of the amount and the 3^rd respondent has made it clear that he is not interested in prosecuting the 1^st petitioner. Taking all the above factors into consideration, the Crl.M.C. is liable to be allowed.

In the result, the Crl.M.C is allowed.