To constitute cheating under Section 420 IPC, there must be evidence of dishonest intention at the inception of the transaction; mere non-performance of a contract does not suffice.

ORDER

This petition under Section 482 of the Code of Criminal Procedure, 1973 (referred to as „ Cr.P.C .‟ hereinafter) is filed for quashing the FIR registered at Crime No. 608/2013 at P.S. Pardeshipura for offence punishable under Section 420 read with 34 of IPC alongwith subsequent proceedings pending before the Court of Chief Judicial Magistrate, Indore.

2. The exposition of facts, in brief, giving rise to the present petition are as under:

Brajesh S/o Pradeep Gupta R/o 276-B, Veenanagar, Indore submitted a written complaint dated 07.04.2023 to the SHO, P.S. Pardeshipura Indore, inter-alia stating that M/s Snehal D/o Sharad Shabnis and Shreepad Shabnis S/o Sharad Shabnis proposed to sell their house No. 1464/23 for consideration of Rs. 25,51,000/-. Accordingly, an agreement was executed on 04.01.2013 in his favour. He paid advance consideration of Rs. 9,51,000/- and published a Public Notice dated 10.01.2013. Ms. Snehal, on pretext of ailment of her brother Shreepad deferred execution of sale deed. Accordingly, second agreement was executed on 25.03.2013 by Ms. Snehal. Despite execution of second agreement, sale deed was not executed by Ms. Snehal and her brother Shreepad in furtherance of the agreement to sell. The accused are trying to sale the property to some other person. On such allegations, P.S. Pardeshipura registered FIR at Crime No. 608/2013 for offence punishable u/S 420 r/W 34 of IPC against Snehal and Shreepad. Relevant seizures were made. The statements of witnesses were recorded. Petitioner Snehal and Shreepad were arrested. On completion of investigation, final report was submitted. The trial is underway.

3. Learned counsel for the petitioners stated that only one prosecution witness namely Sunil Gupta (PW-1) has been examined till date.

4. Learned counsel for the petitioners in addition to the grounds mentioned in the petition submits that no offence, as alleged, is committed by the petitioners. Dispute between the parties is essentially civil in nature, which is given colour of criminal prosecution. Continuation of the proceedings would cause severe prejudice to the petitioners

5. Per contra, learned counsel for the State opposes the petition and submits that the petitioners have not executed the sale deed despite receiving the advance consideration. It goes to show the dishonest intention on their part. During pendency of the petition, the SHO, P.S. Pardeshipura, Indore informed that respondent no. 2 – Brajesh Gupta had expired on 30.05.2017 and his relatives have been given intimation with regard to pendency of this petition.

6. Heard, learned counsel for the parties and perused the record.

7. The section 420 IPC deals with the cheating by dishonestly inducing delivery of property. The petitioner‟s failure to execute the sale deed and to return the advanced money has led to charges of cheating. Mere non- performance of the contract or inaction or deferment in complying with the terms of contract may provide cause of action for specific performance of the contract but dishonest intention to cheat or fraudulent intention to misappropriate the advance amount cannot be inferred from these actions.

8. In the case of International Advance Research Centre for P.M. & N.M. Vs. Nimra Cerglass Technics (P)Ltd. & Anr. reported in (2016) 1 SCC 348 , the Supreme Court held as under:

15. The essential ingredients to attract Section 420 IPC are : (i) cheating; (ii dishonest inducement to deliver property or to make, alter or destroy any valuable security or anything which is sealed or signed or is capable of being converted into a valuable security; and (iii) mens rea of the accused at the time of making the induce