High Court · 2025

in the circumstances . the High Court may- ol 2022 on the file ot Malkaigiri including the above Criminal Petition. This Petition coming on for hearing' upon perusing the Memorandum of i""'nn the arguments of Sri P Giri Grounds of Criminal t"'i*'""0'""n Krishna, Advocate to' tnt pltitioner' iri M Vivekananda Reddy' Assistant Public prosecutor on beharf , irl"'''*".oondent No. 1 and of Sri Gaddam srinivas' Advocate for the ResPondent No 2' The Court made the following: ORDER \ I I 2 TITE IrON'BLE StrIr JI.ISTTCE J.SREENI\/AS RAO 1:,' CRIM I ORDER: NAL PE ITIONNo. 1 o32Oo f20 23 T This Criminal petition has been fiied under Section 482 of the Code of Criminal procedure, 1973 (for short, 'Cr. P. C. ) by the petitioner/ accused seeking to quash the proceedings in C.C. No.6O3S of 2C/22 on the file of the I Metropolitan Magistrate, Cyberabad at Additional Malkajgiri.

2. Heard petitioner, Sri P.Giri Krishna, learned counsel for the Sri Gaddam Srinivas, Iearned counsel for Reddy, Iearned respondent No.2, and Sri M.Vivekananda Assistant pubiic prosecr_rtor, appearing respondent No. 1 _State. on behalf of

3. Brief facts ofthe case: 3.1. The compiainant Sri V.K. Johny filed a private complaint before the I Additional Metropolitan Magistrate at Malkajgiri on 26.C.5.2022 alleging that the accused had borrowed a total amount of Rs. 72,SO,OOO/ _ on various occasions, namely Rs.S,OO,OOO/_ on l7.O2.2Olg, Rs.3,OO,O0O/- on C,4.O4.2O79, Rs.2,oo,ooo/_ on 14.O5.2019 and Rs.2,5O,OOO/_ on 21.O8.2O19, and on ,4 3 each time he executed promissory notes and deposited the original sale deed docurnent bearing No' 24299 of 201.8' as security, with an agreement to pay 2"h monthly interest- The accused initially paid interest but failed to repay the principal amo\rnt' Despite repeated demands' he issued three ckleques in January 2022 for an amount of Rs.S,OO,OOO/-' Rs 3'OO'OOO/- and Rs'2'50'OOO/-' which 11,.O3.2O22, tkre accused were never encashed' On on a Rs.SO/- starnp Paper executed an acknowledgment or before prornising to settle Rs 12'36'OOO/- on 14.(,4.2022' Instead of fulfilling the said lodged a complaint at P'S' Kushaiguda cornplainant and threatened to implicate against the him in false promise, he CASCS grievance of the comPlainant' the 2. Acttng on ttre matter r:.nder Section referred the learned Magistrate 156(3) Cr-P.C', to the Neredmet Police and ttre same was registered as Crime No' 562 of 2022 for offences punishable under Sections 4Cr6, 42O and 506 IPC' and after investigation a ctrarge sheet was frled on 3O'O7 '2022 before the Court of ttre I Additional Metropolitan same was Magistrate, Cyberabad at Malkajgili' 2nd the nrrmbered as C'C' No' 6035 of 2022 ' l 4

4. Submissions of learned counsel for the petitioner: 4.I Learned counsel submitted that the petitioner has not committed any offence and he was falsely implicated in the present case. He further submitted that responclent No.2 filed a private complaint before the J Additional Metropolitan Magistrate, Cyberabad at Malkajgiri, and the learned Magistrate, without verifying the allegations made in the complaint and without assigning any reasons, referred the matter to the police. Basing upon the sarne, a case in Crime No.S62 of 2022 was registered by the police, Neredmet p.S. The Investigating Officer, without properly conducting investigation, filed charge sheet and the Iearned Magistrate without assigning any reasons taken cognizance and the same is contrary to law. Even according to the aliegations made in the complaint and in the charge sheet, the ingredients of Sections 406, 42O and 506 of IpC does not attract against the petitioner. 4 .2 He further su bmitted that the petitioner had executed promissory notes while availing the hand loan from respondent No.2, and also deposited the original sale deed pertaining to his proper[z towards security. The t '"t 5 petitioner has repaid the entire amount' out of whictr' an arnount of Rs'10,24 '622 l- was paid ttrrough online from Og.O4.2OLg to 24 'O2 '2022 to respondent No'2' However' respondent No 2 lodged a private complaint on 26 'O5 '2022 for Rs.12,36,000/ - and wittr the same allegations he also lrled a suit in O'S'No'59a of 2CJ22 ' on the hle of the Jr-rnior Civil Jr-rdge, Medchal-Malkajgiri District and the same is pending.

4.3 He also subrnitted ttrat there is no allegation against the petitioner in the complaint that he availed the loan witkr a diskronest intention and the property docurnent which was pledged by him towards secr'rrity' is not Hence, the initiation of crirninal proceedings ttre petitioner is a clear abuse of the process of law. In support of his contention' he relied upon a judgment of the Hon'ble Apex Court in Vesa Holdings (P| Limited v. State of Keralal' gerlulne against Srrbmissions of learned counsel for respondeot No'2: 5

5.1 LearnedcounselforrespondentNo.2srrbmitted that the Petitioner borrowed a total arnount of In sPite of from respondent No'2' Rs.22,60,622/' 1 (2015) B SCC 293 &.,:*; 6

5.2 threatened No.2 demands the amount, he will file a case repeated demands, he failed to repay the said shown his dishonest intention and when vrsrted the amount and respondent No.2 petitioner's house for demanding money, he him and also warned him that if respondent agarnst him. He further submitted that there are specific aliegations agalnst the petitioner in the cornplaint. The Investigating Officer after recording ttre statements of the wrtnesses filecj charge sheet, wherein the role of the pe ti tioner was specifically mentioned to attract the offences punishable under Sections 406, 42O and,506 of IPC. The allegations made in C.C.No.6O3S of 2022 and the relief sought in O.S.Ncr 598 of 2022, are different ancl distinct. Basing on the pendency of the civil suit in respect of the other amount, the petitioner is not entitled to seek quashing of the proceedings in the present crirninal petition. 5.3 He also submitted that the petitioner has raised several disputed facts in the present petition and the same have to be decided after full_fledged trial only and there are no grounds to quash the proceedings against the petitioner in C.C.No.6O35 of 2022. complaint 1 ./ Analvsis: Having considered the rival submissions rnade 6. by the respective parties and after pemsal of the material available on record' it reveals that the petitioner availed hand loan from respondent No'2 and executed promissory notesandalsodeposited.hisoriginalsaledeedbearing document No'24299 ol 2Ol8 towards security' According to ttre averments of the complaint' the petitioner is due an Rs.12,36,OOO/- and amount of on Rs-SO/- non-judicial starnp Paper acknowledgrnent on or before prornising to pay the above said arnount 14.O2.2022' However' the said amount was not Paid' Hence, resPondent No'2 filed a private comPlaint on 26.()5.2()22 and the learned Magistrate referred ttre sarne to the police' Basing on the sarne' Crime No'562 of 2022 was registered by N eredmet Police and the Investigating Offi.cer filed charge sheet and the sarne was taken executed by the learned Magistrate and it as C.C.No-6O35 of 2022' According to arr arnount of Rs'1O'24 '6221- from O9.O4.2O19 to 24'02'2022 to cogrrizarrce mlmbered petitioner, tre Paid various occasions respondent No'2 8 a 7 The record reveals that respondent No.2 filed a suit in O.S.No.59g of 2022 before the Junior Civil Judge, Medchal-Malkajgiri District, for recovery of the very same amount of Rs.12,36,000/- and the said suit is pending. During the course of hearing, learned counsel for the petitioner submitterl that the petitioner filed written statement denying the averments made in the suit and he had already paid the entire amount claimed in the above said suit. Hence, this Court is of the considered view that r.r,hether the petitioner had paid the entire amount and whether he is liable to pay the amount claimed by respondent No.2 has to be adjudicated in the above pending suit. a. Insofar as the contention raised by the learned counsel for respondent No.2 that the petitioner is due an amount of Rs.22,6o,622/_ and the allegations made in the complain t and the relief sought in the suit are dirferent are concerned, respondent No.2 has not stated in the complaint dated 26.05.2Cr22 tinat the petitioner is drle an amount of Rs.22,6o,622/ -. He specifically made an allegation that the petitioner is dlre an amount of Rs.12,36,O0O/- and. he had executed an acknowledgment 9 onaRS.so/-non.judicialstamppaperpromisingtopay the said arnount towards full and fina1 settlement' and he had agreed to pay the same on or before l4'O2'2O22' However, he has not repaid the said amotlnt' It is pertinent to rnention that there is no specific g. allegation against the petitioner that tle borrowed the amounts from respondent No'2 with a dishonest intention and committed cheating' On pen'rsal of the complaint' dated 26.05 .2fJ22, it reveals that respond'ent No'2 tras given hand loans to the petitioner on ll'O2'2O19' 04.O4.2OLg, 14'Os'2(Ig and 2L'O8'2O19 on executing the deposited the prornissory notes and petitioner had original sale deed bearing No '24299 of 20 18 towards According to the learned counsel for the , the vah-re of the secured property is more than and it is not the case of resPondent the document which was deposited with No.2 towards security is not genuine and there is cloud on ttre said property and also value o[ the property is less than the due amount to him' One Crore rupees No.2 that respondent petitioner sectlritY- 1O. In Vesa Holdings (Pl Limited (supra)' the Hon'lcle .l 1 -1 10 remedies Supreme Court held that not every breach of contract arnounts to cheating Cheating is rnade ot.rt only when there is fraudulent dishonest intention at the very beginning, at the tirne of making the promise or repre sentation. If such intention arises later, it cannot be treated as cheating under Section 42O IpC. Even if civil are availabie, that alone is not a ground to quash criminal proceedings; however, if the a egations do not show dishonest intention from the inception, then no offence of cheating is disclosed. Continuing investigation in such cases would be an abuse of process, and courts should exercise powers under Section 4g2 Cr.p.C. to quash proceedings where cornplaints are rnala hde or fail to disclose a criminal offence.

11. It is a trite law that in order to constitute the offence of cheating under Section 42O IpC, there must be fraudulent or dishonest intention at the very rnception of the transaction. The in State of Ifaryana v. Bhajan the dispute between parties is predominantly civil in nattrre, giving it a criminal colour would amount to abuse of the process of law. It has further been laid down that when payments are 2 (199211 scc 33s Hon'bie Slrpreme Court Lalz, held that where 11 rnade frorn pertains to proceedings time to time and the grlevance recovery of rnoney, the remedy and not in crirninal Prosecution' essentia-llY lies in civil the present case in light of these settled 12. Exarnrnrng principles, it becomes clear that both the complaint and the civil suit arise from ttre very same set of allegations narnely, payment of money said to be due by the petitioner to respondent No'2 ' The petitioner had deposited ttre original sale deed as security and also made sorne payrnents frorn O9'O4' 2019 to 24'O2 2022' The dispute' therefore, is essentially civii in nature and already respondent No'2 filed a civil suit in O'S' No'598 of 2022 and the sarne is Pending' Hence, this Court is of the considered view that 13. continrration of the proceedings i'e' C'C'No'6 O35 of 2Cl22 ' on the file of the I Additional Metropolitan Magistrate' 'Ma1kaj giri' against the petitioner' would Cybera-bad a.t arnount to abr.rse of the process of law' For the foregoing reasolls as well as the 1 4. principles laid down by the Hon'ble Apex Court in Bhaian Lal (supral and Vesa Holdings (Pl Limited (supral ' ttris Court is inclined to exercise ttre powers conferred r.nder the t t I l i : l I I I I I 12 provisions of Section 4a2 of Cr.p.C., to quash .the proceedings against the petitioner. In the result, the crirninar petition is alrowed. 1 5 ' The proceedings against the petitioner in C.C.No.6035 of 2022, on the file of I Additional Metropolitan Magistrate, Cyberabad at Malkajgiri, are hereby quashed. It is made clear that any of the observations made in this order are con{ined for the pltrpose of deciding this case only. As a sequel thereto, miscellaneous applications, if any, pending in this petition stand closed. Note: As directed, tht *:fl ,,,,3"*_*:t^.#"[.T5""1t?[]&,oiin" .- This corr t,[i{,1.:ilrT[1if :s,ru;ny:l"i,.x",.,',u, ".8"#yRE3,l'#l'A SD/- M DEFUTY OHD. REGI ISMAIL STRAR I I //TRUE COPYII One Fair Copy to the Hon,ble Sri Jus (For His Lordshipt kinJ t'i SECTION OFFICER tice J Sreenivas Rao eerusal) To, 1 The 1st Additional tvletropolitan Magistrate, Cyberabad at Malkajgiri ,:r' 2 3 4 t 6 7 8 11 LR CoPies The Under Secretary, Union of lndia' tvlinistry of Law' Justice and Company Affairs, New Delhi Library' High The Secretary, Telangana High Court-AdYo:ale's lssociation il[ii C"'"t sJildings at Hvderabad court for the State o' The Station House Officer' Neredmet Police Station' Rachakonda' Two ccs to the pubric prosecutor, High court for the state of rerangana at 't''niJX'' Hyderabad lOUTl One CC to Sri P. Giri Krishna' Advocate [OPUC] One CC to Sri Gaddam Srinivas' Advocate [OPUCI

9. Two CD CoPies VH/PSLM/ HIGH COURT DATED: OgtOgtzO2S \ \ I I i I I : ; I I I i ORDER CRLP.No.1O32O of 2O2g ALLOWNG THE CRIMINAL PETITION 1 7T q )( t-- i li: +;,,.i- .- : '(.,,, 1? 2 4 sEP 2025 -{-l',::}:.:-- ... \.t,. - t1:tz.-i. __* : -.,...- . J-"- (-) () i .. -:,t .:r) \.':-' \j-- .lk