Jharkhand High Court holds fees paid to S.S.R. Medical College not 'entrustment' under Section 406 IPC

The Jharkhand High Court has ruled that tuition fees paid to a medical college are standard contractual payments and cannot be considered "entrusted property" under Section 406 of the Indian Penal Code (IPC) for the offence of criminal breach of trust. Justice Anil Kumar Choudhary made the observation while quashing criminal proceedings against the Chairman and Secretary to the Chairman of S.S.R. Medical College, Mauritius, in connection with a student's complaint alleging harassment, cheating, and financial exploitation.

Case Background: A Student's Academic Struggle

The case originated from an FIR lodged by a parent whose son, Kairav Kirtne, had taken admission to S.S.R. Medical College, Mauritius, for the 2019-2024 MBBS batch. The informant alleged that the college's faculty and staff subjected his son to hooting, humiliation, and unfair treatment. He claimed the college, in criminal conspiracy, prevented his son from appearing in pre-university and university examinations despite an additional payment of USD 3,000. It was further alleged that the college extorted approximately ₹49.63 lakh through wrongful tactics, forcing the student to leave after four and a half years.

The FIR was registered at Argora Police Station in 2024 under Sections 406 (criminal breach of trust), 420 (cheating), and 120B (criminal conspiracy) of the IPC. The investigation was still ongoing, and no charge-sheet had been filed when the petitioners approached the High Court under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (equivalent to Section 482 CrPC) seeking quashing of the proceedings.

Petitioners' Defense: Voluntary Admission and Academic Records

Appearing through a battery of advocates led by Mr. Vimal Kirti Singh, the petitioners—Pratap Narayan Singh, Chairman, and Ranjeet Kaur, Secretary to the Chairman—argued that the allegations were malicious and aimed at avoiding payment of balance dues of USD 16,000. They submitted that the student voluntarily took admission, and the Delhi office of the college was merely a liaison office authorized by the Reserve Bank of India under the Foreign Exchange Regulation Act, 1973. The petitioners pointed out that the student's attendance was only 46% against the mandatory 80%, and he scored barely 1 or 2 marks out of 15 in internal assessments. Moreover, the student never appeared for university examinations after June 2020 and ultimately withdrew voluntarily in September 2023. Among the 35 Indian students in his batch, he was the only one who failed.

Relying heavily on the Supreme Court's judgment in Narayana Health vs. State of West Bengal (2026), the petitioners argued that the essential ingredients of cheating, criminal breach of trust, and conspiracy were wholly absent.

State's Opposition: Allegations Taken at Face Value

The Special Public Prosecutor and the informant's counsel contested the quashing, arguing that if the allegations were taken as true, the offences under Sections 406, 420, and 120B IPC were clearly made out. They maintained the student had been deceived from the start and financially exploited.

Legal Analysis: Deconstructing the Offences

The High Court meticulously analyzed each offence. Regarding cheating under Section 420 IPC, the court noted that the essential ingredients are (a) deceit, i.e., dishonest or fraudulent misrepresentation, and (b) inducing the person deceived to part with property. The court observed that there was no allegation that the petitioners had any one-to-one interaction with the informant or his son, nor that they induced them to pay anything through deception. Critically, the student pursued his studies for about four and a half years, which negated any claim of deception at the very inception. Citing the Supreme Court's ruling in Uma Shankar Gopalika vs. State of Bihar (2005), the court reiterated 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."

Turning to criminal breach of trust under Section 406 IPC, the court examined the concept of "entrustment." It held that the payment of fees by a student or guardian to a medical college is a standard financial or contractual transaction and does not constitute entrustment of property for a specific restricted purpose where ownership remains with the giver.

Key Observation: "Therefore, in the considered opinion of this Court, the payment of fees of a medical college by a student or his guardian/parents cannot be termed as the 'Entrusted' as word has been used in Section 405 of the Indian Penal Code ."

Since neither Section 406 nor Section 420 IPC were made out, the court concluded that the question of any meeting of minds for criminal conspiracy under Section 120B also did not arise.

Decision: Proceedings Quashed as Abuse of Process

Justice Choudhary held that continuing the criminal proceedings would constitute an abuse of the process of law. The court accordingly quashed the entire criminal proceeding in Argora P.S. Case No. 199 of 2024 against the petitioners.

Implications of the Ruling

This judgment clarifies that routine payments for educational services cannot be shoehorned into criminal breach of trust unless there is a specific entrustment with a fiduciary obligation. It reinforces the principle that academic disputes or grievances over college fees should ordinarily be resolved through civil remedies or institutional mechanisms, not criminal prosecution, unless there is clear evidence of deception from the very beginning.