Prosecutor High Court · 2025

Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to quash Order dated 2510712019 in Criminal Revision Petition No 270t2018 on the file of METROPOLITAN SESSIONS JUDGE, NAMPALLY. HYDERABAD Confirming the order Dt.0710812018 in S.R No 5101/2018 on the file of the lll Addl Chief Metropolitan Magistrate, Hyderabad and direct the learned Magistrate to refer the matter to policeitake cognizance of the offence in S.R No.510'1/2018; This Petition coming on for hearrng,upon perusing the Memorandum of Grounds of Criminal Petition and upon hearing the arguments of Sri CHETLURU SREENIVAS, Advocate for the Petitioner and Sri M.Vivekananda Reddy, Addl. Public Prosecutor on behalf of the Respondent No. 1 and none appear for the Respondent No.2; The Court made the following: ORDER THE HONOURABLE SRI JUSTICE K.SURENDER CFJMINAL PETITION No .747L OF 2019 ORDER: This Criminal Petition is frled under Sectioo 492 of the Code of. Criminal Procedure, lg73 (for short .Cr.p.C.) by the petitioner/Complainant, questioning the orders of the trial Court and the Appellate Revision Court in dismissing the private complaint filed by the petitioner herein against the respondent/ accused.

2. A private complaint was hled by the petitioner herein to refer the case for the purpose of investigation. The learned III Additional Chief Metropolitan Magistrate, Hyderabad, recorded the statement of the person representing the complainant company as pW. 1. According to the case of the complainant, the respondent/accused approached the complainant and offered thet lands for sale. After entering into a contract dated 06.04.2013, they took Rs.SO lakhs towards advance. However, the issue was dragged on without registering the land. When the complainant insisted on tl:re return of the amount, a cheque for Rs.SO lakhs was issued by the accused. When the said cheque was presented for clearance, the cheque was returned unpaid. In fact, the agreement was for purchase of 50 acres of land at the rate of Rs. 12,75,00O/- per acre. 2

3. The learned Magistrate lound that the transaction pertains to a sale, and that the complainant ought to have approached the Civil Court by filing a suit for specific performance, if the complainant had the resources to pay t}le arnourlts covered by the contract. It was further observed that there was no intention to cheat in the present circumstances of the case, and it is a clear case of breach of contract. The criminal prosecution calnot be permitted since the dispute is purely civil in nature. The said order, dismissing the complaint fiIed by the complainant, was passed on 07.O8.2018 in S.R.No.Sl0ll2Ol8.

4. Aggrieved by the said order passed by the learned Magistrate, the complainant approached the Sessions Court by filing Criminal Revision Petition No.270 of 2018.

5. The learned Sessions Judge considered the revision application and found that the complainalt, except stating tl:at the accused approached them with a criminal intent, had not set forth any circumstances before the Court to infer aly dishonest intention. Further, in the complaint, there was no mention about any kind of inducement by the accused, except that a Memorandum of Understanding was entered into between the complainant and the accused. Further, the learned Sessions Judge found that there is no averment in the complaint that the 3 alleged threat by the accused caused any kind of alarm to attract an offence under Sections 4O6 and 506 of the Indian penal Code.

6. The learned Sessions Judge further found that it was explicit from the transactions and the Memorandum of Understalding that the case is purely civil in nature, and that any failure on the part of the accused to abide by any of the conditions in the Memorandum of Understanding ought to have been addressed by the complainant before a Civil Court. The learned Sessions Judge stated that the trial Court had rightly dismissed the complaint.

7. The complaint was frled on the allegation of committing tlle offences under Sections 4O6, 4O9, 42O, and 506 of the Indian Penal Code.

8. The Honourable Supreme Court, in S.K.Atagh o. State oJ Uttar Pradesh and. othersr, held as follows: o78. Ingredients of the offence under Section 4O6 are: "(1) a person should haue been entrusted with propertg, or entrusted utith dominion ouer propertg; (2) that person should dishonestlg misappropiate or conuert to his ou)n use tLnt propertA, or di_shonestlg use or dispose of tlwt propertg or uilfullg suffer ang otter person to d.o so; I lzoot; s scc ooz I (3) tl'nt such mkappropiatiory conuersinn, use or disposal should be in uiolotion of ang direction of lau prescibing the mode in which such trust is to be dischorged, or of ang legal antract which the person has made, touching tle discharge of such trust."

9. The Honourable Supreme Court, in N.Raghauender a. Sta:te of Andhra Pradesh, CBI 2, held that: ulngredients necessdry to proae a charge under Section 409rPC

45. Section 409 IPC pertains to ciminal breach of trust bg a public seruant or a banker, in respect of tLrc propertg enhusted to him. TLe onus is on the prosecution to proue tLLat tLrc occused., a public seruant or o banker roas entrusted utith th.e propertg uthich he i.s duly bound to account for and that he has committed ciminal breach of trust. (See Sadhupati Nagesuara Rao u. State of A.P. [Sodlupati Nagesutara Rao u. Stote of A.P., (2012) I SCC 547 : (2012) 3 SCC (Cri) 979 : (2012) 2 SCC (L&S) 6s8l ) 46. The entnlstment of public property and dislrcnest misoppropiation or use thereof in the manner illustrated under Section 4O5 are a sine qua nonfor making on offence punishoble under Section 4O9IPC. TLe expression "criminal breoch of lrust" is defined under Section 4OSIPC uthich prouides, inter alia, that uhoeuer being in anA monner entntsted Luith propertA or uith ang dominion ouer a propertA, di.shonestlg misappropriates or conuerts to his oun use tlnt propertA, or di.sLnnestly uses or disposes of tlnt property contrary to laut, or in uiolation of ang latu prescribing ttrc mod.e in uhich such trust is to be dischorged, or controuenes '120211 l8 sup,"*e Court Cases 70 \ I 5 ang legdl contract, express or imptied., etc. shall be hetd. to haue committed ciminat breach of ttust. Hence, to attract Section 4OSI?C, the fo otuing ingred.ients must be satisfted: 46.7. En.trusting ang person uith propertA or u;ith ana do miniort o u e r p rop ertg. 46.2. That person hr:s d.i.shonesttg misappropriated or conuerted thnt propertg to his own use. 46.3, Or that psTssn i.s di.shonestlg using or d.isposing of that propertg or u fuug suffering ang oth.er person so to do in uiolation of ang direction of lana or a legal contract. 47. It ought to be noted that the crucial u_tord_ used in Section 4OSIPC is "di.shonestlg" and therefore, it pre_supposes the qcistence of mens rea- In other uord_s, mere retention. of propertA entrusted to a person withaut ang misappropriation cannot fall tuithtn the ambtt of ciminal breach of trust. t_Inless there i.s some actual use bg the accttsed. in uiolation of lau.t or contract, coupred uith distanest intentton, ttere is no ciminar breach of trust. The second. signtfi.cant expression i^s 'misappropiates" u,thtch means improperlg setting ttpart for ones use and to tlte exclusion of the owner. 48. No sooner are the tu.to fundamentat. ingred.ients of 'criminal breach of tntst" ulithin th.e meaning of Section 4OSIrc proued, and. tf s1.tch ciminal breach i.s caused bg a public seruant or a banker, mercha.nt or agent, the said offence of ciminat breach of trust i.s puni.shabte under Section 4O9IPC, J'or which it is essentjal to proue that: (i) Th.e accused mtst be merctm.nt or agent; (ti) He/ She mttst haue been entrusted, in such capacity, tuith propertg; and a publir seruant ora banker, I 6 1 (iit) He/ She m st haue committed breach of tntst in respect of such propertA.

49. AccordingLA, unless it is proued that th.e accused, a public seruant or a banker, etc. tDOs "entntsted" with the propertA rphich he i.s dutg-bound to account for and that such a person Lns committed ciminal breach of tnlst, Section 4O9IPC mag not be attracted."

10. The Honourable Supreme Court, in A.M.Mohan a. The Strrte rep. bg SHO and others3, held as follows: *78. Section 420 of tLLe PenaL Code reads thus: "42O. Cheating and dishonestlg lnducing deliuery of propertg.-Wlneuer cheats and therebg dishoneitly induces the person deceiued to deliuer ang propertg to anA person, or to make, alter or destroy tlne u.thole or any part of a ualuable seatitg, or angthing uLhich is signed or sealed, and uhich is capabLe of being conuerted into a ualuable secuity, shalt be punished uith imprisonment of either desciption for a term which may ertend to seuen gears, and stnlL aLso be liable to fine." 19. The ingredients to constitute on offence under Section 420 qre as follotus: 79.7. A person trast commit tle offence of cheating under Section 4 15; and

79.2. Tlrc person cheated must be dishonestlg induced to (a) deliuer propertg to anA person; or (b) make, alter or destrog ualuable security or angthing signed or sealed and capable of being conuerted into ualuable securitg. 3 2024 SCC Online SC 339 7

20. Cheating is an essential ingred.ient for an act to constttute an offence under Section 42O." ll. The Honourable Suppsrng Court, in Mqd.hushree Dattq. o. The State o:f Korrtoltcrka, and others4,held that: *3g, Thi.s brings us to the offence under Section 5O6 of the IpC, u.thich tl.Le High Courl has fourul to be pnna facie di.sclosed agairLst the apperlants. section 506 0f the IK prescibes the puni-shment for tte offence of ciminat intimtdatiory while section so3 deftnes the offence of ciminal intimidation. 34. Thi^s Court had the occasion to examine the ingredients of Sec/ion_s SO3 and 5O6 of tLe IpC in Manik Taneja u. Stdte of KarnatakaLi, wh.ere it utas obserued. as follows: " 1 1. .rcrxxxxxxxncr A readirLg of the defnition of ,criminal tntimid.ation' uould indicate that th.ere must be an act of threatening to anotler persory of causing an injury to the person, reputation, or propertg of the person tLveatened, or to the person in uham the tlweotened person is interested. and the threat must be uith the intent to cause alarm to the person threatened or it mast be to do anA act uthich he is not legaltg bound to do or omit to do t zn act uthtch he i-s legallg entitLed to do., t2 In the entire complaint filed, there is nothing for lhis Court to infer that there was any kind of misrepresentation or any deceptive practices at the inception of the transaction, when there was an agreement between the complainant and the accused for tlle transaction of sale of land. r 2025 SCC Online sc 165 \-- 8

13. A Memorandum of Understanding was entered into between the accused and the complainant for purchase of 50 Acres of land situated at Gudrampally village of Chityaf Mandal, for an amount of Rs.12,75,00O/- per acre. An amount of Rs.50 lakhs was paid, and the Memorandum of Understanding entered into between the complainant and the accused was revoked by the complainant, who then sought return of the Rs.50 lakhs paid as advance. The termination letter of the Memorandum of Understanding was also addressed to the accused. The cheque issued towards repayrnent of Rs.5O laklrs was returned for the reason of 'drawer's signature differs'. For the said reason, the criminal complaint was filed.

74. In the entire complaint, except the transaction of entering into a Memorandum of Understanding alld thereafter paying an amount of Rs.50 lakhs, there is no averment to suggest that the accused entertained any intention to cheat the complainant. The mere cancellation of the Memorandum of Understanding between the parties, by itself, would not mean that the accused intended to cheat the complainant/petitioner from the inception of the transaction- What is required to substantiate the offence of cheating is the deceit played by a person at the inception of the transaction. In fact, the Memorandum of Understanding was cancelled by the complainant. It is not the case of the complainant 9 that the lands were not available or that the accused refused to provide the lands as sought by the complainant. As rightly found by the Courts below, the transactions between the complainant and the accused are purely civil in nature.

15. For the aforesaid reasons, Criminal petition is dismissed. Miscellanr:ous Petitions, pending if any, shall stand ciosed. //TRUE COPYII Sd/- A. JAYASREE ANT REGISTRAR (--TION OFFICER To,

1. The Metropolitan Sessions Judge, Hyderabad 2. The ill Addt. Chief MetropotitanlVagistrate, iyOeraOaO 3. One CC to SRt CHETLURU^SREENTVAi'eiroc"te 4. rwo ccs to pUBLtc PRoSECUTOR, High c;,l"n;l-Hyd"iri,ro 1ourl 5. Two CD Copies tOpUCl VSM/gh Yt' I I HIGH COURT DATED:11104t2025 \{ok EH -s 14 ro o o 10 JlJf{ 2m $ ''a I C ORDER CRLP.No.7471 of 2019 DISMISSING THE CRIMINAL PETITION g *t+ &,