The High Court · 2025

Petition under Section 482 ol Cr.P .C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition,the High Court may be pleased to stay all further proceedings including the appearance of the petitioners in C.C.No. 1013 of 2021 on the file of the Judicial First Class, Magistrate at Bhad rachalam, ; This Petition coming on for hearing,upon perusing the Memorandum of Grounds of Criminal Petition and upon hearing the arguments of Sri C SHARAN REDDY, Advocate for the Petitioner and Smt S.Madhavi, Asst. Public Prosecutor on behalf of the Respondent No.2 and Sri P.V.Ramana, Advocate for the Respondent No.2; The Court made the following: ORDER THE HONOURABLE SMT JUSTICE JUWADISRIDEVI - CRIMINAL PETITIOI\{ No.1617 OF 2022 ORDER This Criminal Petition is filed by the petitioners- accused Nos.1 and 2 seeking to quash the proceedings against them in C.C.No.1013 o'f 2021 pending on the file of learned Judicial First Class Magistrate at Bhadrachalam, registered for the offences under Sections 420, 323, 294(b), 506 read with 34 of the lndian Penal Code (for short'lPC').

02. Fleard Sri C.Sharan Reddy, learned counsel for the petitioners and Sri P V.Ramana, learned counsel for the unofficial respondent No.1 as well as Smt.S.Madhavi, learned Assistant Public Prosecutor for the State-respondent No.2. Perused the record

03. Brief facts of the case are that the complainant along with her husband residing rn one portion of their daughter's house bearing No.9-1-1 12l4 and they were using the remaining portions for rental basis. The petitioners-accused Nos. '1 and 2 were \ 2 inducted as tenants and developed acquaintance with the complainant and her husband. Due to the said acquaintance, the petitioners-accused Nos.1 and 2 made them to believe that if they invest their assets and shares, the petitioners/accused Nos 'l and 2 will pay Rs 2/- as interest. For which, both the complainant and her husband on different dates gave Rs.19,00,000/- to the petitioners-accused Nos.1 and 2. Thereafter, for a period of six months, both the accused paid interest amount to the complainant. Subsequently, they reduced the interest rate from Rs.2/- to Rs.1.50 and paid amounts for a period of four months. The petitioners-accused Nos.'l and 2 used to run finance business with high rate of interest. On

19.08.2020, the complainant demanded the petitioners- accused Nos.1 and 2 to repay her amount, for which, petitioners-accused Nos.1 and 2 have repaid Rs.5,00,000- 00 and assured of returning the remaining amount on or before 31 .03.2021. Thereafter, the petitioners-accused Nos.1 and 2 vacaled the house of the complainant. Complainant and her husband went to the petitioners- accused Nos.l and 2 and demanbed to repay their amount, for which, accused Nos.1 and 2 beat, abused in 3 most filthy language and threatened them with dire conseq uences

04. Learned counsel for the petitioners submitted that the petitioners are nothing to do with the alleged offences. There is no dishonest intention on the part of the petitioners-accused Nos.1 and 2. Mere failure to repay the loan amount would not amount to criminal offence of cheating. There is no element of cheating from the beginning of the transaction. There is no medical evidence. There is no fraudulent intention on the part of the petitioners/accused Nos.1 and 2 lo cheat the complainant. All the allegations levelled against the petitioners-accused Nos.l and 2 are purely civil in nature and the respondent No.1 -complainant is trying to convert the civil dispute into a criminal dispute. 05 With the above submissions, learned counsel for the petitioners-accused Nos.1 and 2 while praying for the quashment of criminal proceedings relied upon a decision of the Honourable Supreme Court ol lndia in Sathishchandra Ratanlal Shah ys. Stafe of Gujarat 4 and Anothel, wherein it was held at Paragraph No 13 that: \ "13. Now coming to the charge under Section 41 5 punishable under Section 420 of IPC' In the context of contracts, the distinction between mere breach of contract and cheating would depend upon the fraudulent inducement and mens rea' (See Hridaya Ranian Prasad Verma v State of Bihar, (2000) 4 SCC 168) ln the case before us' admittedty the appellant was trapped in economic crisis and therefore, he had approached the respondent no.2 to ameliorate the situation of cisis. Further, in order to recover the aforesaid amount, the respondent no 2 had instituted a summary civil suit seeking recovery of the loan amount which is still pending adiudication The mere inability of the appellant to return the loan amount cannot give rise to a criminal prosecution for cheating unless fraudulent or dishonest intention rs shown right at the beginning of the transaction, as it rs this mens rea which is the crux of the offence. Even if all the facts in the complaint and material are taken on their face value, no such dlshonesf representation or inducement could be found or inferred'" ' (zorg) s SUPREME couRT oASES 148 5

06. Further' he relied upon a decision in lnder Mohan Goswami and Another vs' State of lJttaranchal and Others2 it was by the Hon'ble Supreme Court at ParagraPh No.42 that: "42 On a reading of the aforesaid section' it is that in the definition there are two manifest c/asses of acts which the Person separate deceived may be induced to do' ln the f,rst c/ass of acts he may be induced fraudulently or dishonestly to detiver property to any person' The second c/ass of acfs is the doing or omitting to do anything which the person deceived would not do or omit to do if he were not so deceived ln the firsf c/ass of cases, the inducing must be fraudulent or dishonest. ln the second c/ass of acts, the inducing must be intentional but need not be fraudutent or dishonest Therefore' il ls the intention which is the gist of the offence To hold a person guitty of cheating it is nece'ssary to show that he had a fraudutent or dishonest intention at the time of making the promise' From his mere failure to subsequently keep a promise ' one cannot presume that he atl along had a culpable the promise from the intention to break beginning " ' (zootl'tz SUPREME couRT oASES 1 // \' 6

07. On the other hand, learned Assistant Public Prosecutor appearing for the State as well as learned counsel for the respondent No.1 contended that there are triable issues and factual aspects to be examined by the learned trial Court and it is not a fit case to quash the proceedings against petitioners at this juncture and the matter is to be decided after conducting full-fledged trial by the trial Court and prayed to dismiss this Criminal Petition.

08. Having regard to the submissions made on either side and on perusal of the record' it is apparent that both the complainant and petitioners-accused Nos.1 and 2 are well acquainted with each other. The complainant had given totaling an amount of Rs.19'00,000-00 on different dates to the petitioners-accused Nos.1 and 2 by believing their words. Subsequently, there are fluctuations of interest rates and the same has been agreed by the complainant and accordingly part payments were also done. lt is also apparent on the face of the record that the petitioners-accused Nos.1 and 2 have admittedly returned some amount to the comPlainaht. 7 09 lt is settled principle of law that the dishonest intention to cheat the complainant shall be from inception. ln the case on hand, on the demand made by the complainant for relurn of the amount, petitioners- accused Nos.1 and 2 have returned the part of the amount to the complainant and further they undertook to return the remaining amount. lt is borne on record that the petitioners-accused Nos.1 and 2 resided in the rented premises of the complainant for certain period and both the complainant as well as the petitioners-accused Nos.1 and 2 have maintained deep relationship with each other and admittedly there were some money transactions with different rates of interests. Therefore, the allegation that there rs dishonest or fraudulent intention on the part of the petitioners-accused Nos.'l and 2 to cheat the complainant, right from the beginning of the transaction, has no water and the same is not sustainable in the eye of law. 10 lt is to be noted that admittedly there is no complaint lodged or reported grievance by the complainant when there was proposed decrease in the rate of interest by the petitioners-accused Nos. j and 2. lt I B is settled principle of law that mere inability of the petitioners-accused Nos.1 and 2 to return the amount cannot give rise to a criminal prosecution for cheating unless fraudulent or dishonest intentibn is shown right at the beginning of the transaction. ln view of the above observations, the required material ingredients for constituting the offence under Section 420 of IPC are not made out against the petitioners-accused Nos.1 and 2.

11. Now coming to the other allegations for,the offences under Sections 323, 294(b) and 506 of IPC are concerned, primarily, there is no medical record like statement of the competent Doctor or wound certificate to show that the complainant or her husband sustained any injuries in the hands of the petitioners-accused Nos.'1 and

2. So also, there are no descriptive particulars or acts of singing, reciting or uttering any obscene song, ballad or words, in or near any public place, by the petitioners- accused Nos.l and 2 annoying the complainant and her husband. There are no specific allegations against the petitioners-accused Nos.1 and 2 as to in what manner I they have threatened causing criminal intimidation to the complainant and her husband.

12. On a careful scrutiny of entire charge sheet averments, to prove the basic allegations against the petitioners-accused Nos.1 and 2 tor the alleged offences, there is no single independent witness examined by the Police. Oul of seven list of witnesses cited, four are family members of the complainant, who are interested witnesses. Even there is no statement of the competent , Doctor to show that complainant or her husband sustained any injuries in the hands of the petitioners-accused Nos.'l and 2. lt is relevant to note here that mere oral allegations do not constitute any offence. 1 3 In view of the aforesaid facts and I I circumstances of the case including the settled principle of law laid down by the Hon'ble Supreme Court of lndia in the above decisions, this Court is of the firm opinion that the allegations levelled against the petitioners-accused Nos.1 and 2 do not attract the offences under Sections 420, 323,294(b),506 r/w 34 of lPC. Therefore, even if a[ the facts in the complaint as well as charge sheet are \ 10 taken on their face value, no alleged offences are found or inferred. Hence, the continuation of the criminal proceedings against the petitioners-accused Nos.'1 and 2 amounts to sheer abuse of process of law and the same are liable to be quashed.

14. Accordingly, this Criminal Petition is allowed and the proceedings against the petitioners- accused Nos.1 and 2 in C.C.No.1013 of 2021 pending on the file of learned Judicial First Class lvlagistrate, at Bhadrachalam, are herebY quashed. \ To, As a sequel, pending miscellaneous applications, if any, shall stand closed. //TRUE COPY// SD/. L. LAKSHMI BABU DEPUTY REGISTRAR Bqv SECTION OFFICER District

1. The Judicial First Class Magistrate' Bhadrachalam 2. The Station Ho,.u otri"lll'Bh;;;;#iown P s ' Bhadradri Kothasudem 3 &;';'c to SRl. c sHARAN REDDY Advocatl[oPuC1 ; il cc i" snr P v RAMANA Advocate [oP^UC]. 5 rwo ccs to PUBLIc PilfidAijibli]iJidn co"t at Hvderabad (oUr) 6. Two CD CoPies \tSMi gh *,y HIGH COURT DATED:0310412025 ,t o Lt- J oF TE( .$ ^$\$ tt9 li-i r O 1,' + .{-',1 ORDER CRLP.No.1617 of 2022 ALLOWING THE CRIMINAL PETITTON P( 1\