The High Court · 2025

TI{E HONOURABLE SMT JUSTTCE JUWADI SRIDEVI - t.l \\ No.11095 OF 2022 D This Criminal Petition is filed by the petitioneraccused seeking to quash the proceedings against him in C.C.No:g2S ot 2022 on the file of the leamed ll Additional Junior Civit Judgeanm-lX Additional Metropolitan Magistrate, Medchal, Cyberabad, registered for the offences under Sections 420, 506 of the lndian Penal Code (for short ,lpC').

02. - Heard Sri Mohd. Muzaferullah, leamed counsel for the petitioner-accused and Smt.S.Madhavi, learned Assistant Public Prosecutor for the State-respondent No.1. Even after service of notice by way of news paper publication, none appeared on behalf of the unofFrcial respondent No.2. Perused the material on record.

03. The case of the prosecution, in brief, is that the complainant-respondent No.2 engaged in business under the name and style of M/s.MSLG lnfrastructures, situated at Rajshri Diamante, Kompally Mltage. ln the year 2017, the 2 petitioner-accused came into contact with the respondent No.2 and represented that he was engaged,in business dealings, possessed land parcels for solar projec.ts, and had executed various projeefs for differerat companies. ln September 2019, the pelitioner-accused approached the a hand' loan of No.2 and Rs.1,31,00,O00/- to meet his urgertt business requirements, assuring repayment within a period of one year. For which, No.2 advanced a total sum of Rs.1,30,67,000/- to the petitioner-accused on different dates through seven cheques. However, even after the expiry of the stipulated period, the petitioner-accused failed to repay the said amount. When the respondent No.z dernanded willfully refused: to discfiarge the liability. Hence, the respondent No.2 lodged a complaint against the petitioner-accused

04. Learned counsel for the pgtitioner submits that the petitioner-accused is nothing to do with the alleged offences. lt is contended that no dishonest or fraudulent intention can be aftributed to the petitiondr-acrused from the r ( 3 inoeption of the transaction. All the allegations leveled against the petitioner-accused are false, baseless, and fabricated for the purpose of the present case, being far from truth. lt is further submitted that there is no incriminating material on record to substantiate the allegations made +r against the petitioner-accused. The dispute, if any, is.purely civil-in naturc, an( respondent No.2.is aftempting to give a criminal colour to a civil dispute. The contents of the charge sheet do not disclose the necessary and essential ingredients required to constitute the 9ffen9e9 under Sec'tions 42O and 506 of the lPC.

05. With the above submissions, leamed counsel for the petitioner-accused while praying for the quashment of criminal proceedings relied upon a decision of the Honourable Supreme Court tn Sripati Singh (since d*easrf/) thtough his soa Gaurav Singh v. The State of Jha*hand and anothey', wherein it was heH at Paragraph Nos.11and 12that I Criminal Appeal Nos.18g-127o of m21 4 't'!. ln the backgtaund ot what has been, taken nate by us and the conclusion rcached by the High @utt, insfar as frrc Hiljh @urt aniviig at the andusion that no case punishabte uider Secfaon 420 iPC can be made out in these facts, wd arc in qteement with such rcndusion. This is due ta tlle fad,that eyerl as pr the aase of the appllant the amount aduand 6y the appeilant rs fowards fhe Dusmess tmnsadbn,and a loan. aSteei?eq!":tld,f been entercd ihr, :between trc padies. Uider thet loan agteement; :the. period for rcpaymeat was agrced and the cheque had,been iss-ned fo,easae repaynent lf is no dsubt irue that the cheques when prcented for reatisatian werc didtonourcd The merc dishonourment of the cheque cannot be @nitrued as ah acl on the paft of the rcspondent No.2 with a deliberate intention to cheat and the mens rca in that regard cannot be gathercd frcm,the point the amount had been rcceived. tn the prc*nt facts and circunstances, therc is no suffiaient evidence to indicate the offence under Section. 420 tpc is made out and,thercforc on that asped, we see ro reasoa fo interferc with the oonclusiom,reached by the High hurt. !!!. Havfiq, anfircd at $reabave concfusion. and al* havirp taken note.of the crlndusbn erched bythe High @uft as extactd abotre, it is nofed that thg tliQh'' @uft fas ffsdlf arived at the andusion that the iasfbnf case Deoomes a simpliQter case of aon-tefuNing sf loan which cannot be a basis for irtitiating ciminal proceedings. The conctusian to. the extent of holding that it would not,constitute an offence of (Arising out of SLp(Cdminat) No.2S2-2SEIZO2O r 5 ctrcating, as alrcady indiated above wwld be jusfified. Holl,Even when the High @uft it*lf has 'awpted the fxt that it is a casr- of non rcfunding of the loan amount, the firct asped that there is a legatly rwvenble &bt frcm the rcspon&nt No.2 to tlrc appettant is pimafacie established. The only queilbn that thercfote needs ' clcinsidr,'ation at our hads is as fo whether the oontention pdtforth on behalf of rcspondent No.2 that an offene under *dion 138 of the N.l. Ad is not made wt as the dishonourment allege4 is of the cfegues which werc issued by way of ' '*anrity' and not towads di*harye of any deil!

06. On the other hand, learned Assistrant Public Prosecutor appearing for the State-respondent No.1 contended that there are triable issues and factual aspecG to be examined by the learned trial Court and it is not a ftt case to quash the proceedings against the petitioner at this juncture and the mafter is to be decided after conduding trial by the leanred trial Court and prayed to dismiss this Criminal Petition.

07. ln oder to aftract tlre provisions of Sedion 420 lPC, it is a wellseftled principle of law that there must exist a dishonest or fraudulent intention to deceive the mmplainant from the very inception of the transaction. Mere failure to 6 fulfill a promise or to repay tfie loan amount, without such initial dishonest intention, would not constitute an offence under Section 420 lPC. Similarly; for invoking,the penal provision under Section 506 lpC, there must be a specific allegation that the accused threatened the complainant with injury to his person, reputation, or property, or to the person or reputation of someone, in wtrom he is interested; with the intention of causing alarm or compelling him to act against his will. ln the absenoe of these essential ingredients, the invocation of the aforesaid penal provisions is unrsustainable in law.

08. Having considered the submissions advanced on either. side and upon perusal of the rnaterial placed on record, it is evident that the petitioner-accused and respondent No.2 have been aoquainted'with each other since the year 2617. The alleged loan transactions between the petitioner-accused and respondent No.2 is strated to have taken place in the years 2019 and 2020. According to the respondent No.2, he advanced various amounts on different dates, aggregating to. a surn of Rs.1,30,6V,OOO!_. lt is an 7 admifted fact that all the said amounts were advanced through cfreques on different dates during the years 2019 and 202f,. lt is further alleged that, despite repeated demands, the petitioner-accused failed to repay the said loan amount.

09. A careful perusal of the contents of the charge sheet reveals that the dispute essentially pertains to monetarytransac{ions between the parties. Mere demand for repayment of the loan amount, by itself, does not prima facie batisff'the ingredients necessary to constitute the offence under Secdion 42O of lPC. Furthermore, except for a vague allegation that the petitioner-accused threatened respondent No.2 with "dire consequences," there is no specific assertion indicating the nature of the act oommitted by the accused ufrictr could have caused alarm in the mind of the respondent No.2 so as to attract the offenoe under Section 506 lPC. lt is also an admifted fact that the alleged transactions took plaoe during the years 2019 and 2o?O, whereas the complaint came to be lodged only in December

2021. Such unexplained and inordinate delay in sefting the E] criminal law into motion casts a Serious doubt on the genuineness andveracity of the allegations made against the

10. lt is pertinent to note that the investigation canied out subsequent to the registration of the FIR and prior to the filing of the cfiarge sheet constitutes a crucial sJage in criminal proceedinge. The charge sheet is required to reflect the outcome of such investigation, supported by material evidence sufficient to establish the allege( offences. l-'lowever, in the present case, to substantiate the basic allegations against the -petitioner-accused, no independent witness has been examined by the Investigating Officer. Out of the seven witnesses cited, two are official witnesses, one is the de-facto cbrnplainant; turo are his employees, and the rernaining two are,pancfi witaesses for the CDF. The entire nowever, revolve around the alleged failure of the petitioner-aoqtsed, to. repay the amount due to the complainant. lt is an admitti:d fact that the amourfts were advanced through chegues in favour of the accused, but, the lnvestigating Officer failed to examine the f I concerned bank officials to verify wtrether the said cheques were actually encashed in favour of the petitioner-accused, which omission is fatal to the case of the prosecution' However, the altegations on their face appear to be purely 'in nature. Therefore, initiation and continuation of criminal proceedings against the petrlioner-accused cannot be sustained in law.

11. ln Stale of Haryana and otherc v. Ch.Bhaian Lat and othetf the Hon'ble Supreme Court of lndia held that: "ln tte exercis of the extnodinary prter uder Article 226 or the inherent pwets under *dion 482 of tl:re Me of Ciminal Prwdurc, the following ategoies of cases arc given by way of illustntlon whercin such power auld be exerci*d either to prcvent abu* of the process of any @tft or otherwi* to wure the'ends of justioe,.tfuugh it may not be possible to lay down any brecisr,, cleafly defined and sufficiently dtannelisd aN inflexible guide myriad kinds of ca*s whercin such potrer should be exetci*Cl: (!) wherc the allegatbns made in the First tnfomatian Report or the amplaint, even if they arc tal<en at their fae value and arcpted in their 'z tggz scc (supp) r ags 'to t!1e entircty do not prima frcie anstitute any offene or make ouf a case against the acc&sedj (/l wherc the ailegations in the Firt/- lnformation lrpy md Anei materiats, ff any, ";;p;,?;;i;g .1.!.R. do not drsc/ose a @gnizabte'otrine, justitying an investigafron by fie offirx;rc under Secfion 1 56(l ) of the hde exept un&r an.order of a Magistnte within the puwiew of *ction 155(2) of the @e; (3) whete ,the unconhovefted ailegations made in t e. FtR or bomplaint "lra Ur. evidence collectd in support of the same do not disclose the commission qf any offence and make out a case agamst ffte accused; (!) where ihe allegations ia fhe. FtR,do not constitute a cognizabte offene but onetitute only. a non-xtgnizable offene, no investigation is permifted by a polie officer without an order of a Ulgistyte as mntemptated under *ction 15i(2) of the Code; (S) wherc ttre ailegaklns made in the FIR or complaint aoe. so absurd aN inhercnily improbable on the 0as,b of which ,no, pruaeit Wrson.can ever rcaoh a just oondusbn frrat thee is sufftcient grcundt for prcceecfrng against the aocused,' Gl where there rb ao expless legat bar engrafted in any of ffrc prcvisions of the @de ir the conoe.med Act (tnder whtch a criminat ptoceeding is. inslituted) to the in$itution and continuane of fic prc.eedings and/or where there is a speeific provision in the.Cde or the r It @n@md AcI, providing effic&us redrcss br tlre grievane otthe aggrie@ PartY fl) where a qiminal pwding is manifestly attenbd with mala fide and/or where the prowding is maliciutsly instftded with an ulteior nptive for wreaking vengean@ on tlp aaused and with a vbw to spite him due to private and personal grudge."

12. ln the present case, as discussed hereinabove the material on record clearly indicates that the accused and respondent No.2 have been ac4uainted since the year 2017, and the alleged transactions took place during the years 2O19 and 2020. The complaintr however, came to be lodged only in December 2021, thereby resulting in an unexplained and inordinate delay in sefting the criminal law in motion. The amounts alleged to have been advanced by respondent No.2 were through cheques, yet the charge sheet is silent as to whether those cheques were actually encashed in favour of the petitioner-accused F no independent witness or oncemed bank official has been examined to establish this crucial asped. There is no material on record to suggest any elernent of cheating or fraudulent intention aftributable to the petitioner-accused \ 12 from the qf the transadion so as to,.constitute an there, is no offience under Section 42O, of lpc. incriminating to show that the petitioner-accused caused any alarm in the mind of respondent Mo.2 so as to aftract the offence under Sec.tion 506 lpC. The,allegations, on the faoe of it, appear to- be of a purely ciMl nature. even if the contentrs of the charge sheet are taken at their face value and accepted in their entirety, they do not prima facig disclose the comrnission of any offen@ against the petitioner-aecused. Hence, the present case falls within the parameters of point No.3 of Ch.Btnjan Lalb case cited 1'3. ln view at the afonementiened fiacts and circumstances and, having regard to the prihciples of law enuncided by the ttonourable Suprerne Court in the decisions refered supr4 this Cour,t is of the view that the essential to. constitute the offences under Sections 420, 506 of lpC are not made out against the petitirrner-accused. frerrce, the continuation of the crirninal proceedings against the I t3 petitioner-aocused amounts to sheerabuse of process of law and the same are liable to be quashed

14. Accordingly, this Criminal Petition is allowed and the criminal rngs against the petitioner-accused in C.C.No.825 of 2O?2 on the file of the leamed ll Additional Junior Civil Judgeqrm-lX Additional Metropolitan Magistrate, Medchal, Cyberabad, are hereby quashed As a sequel, pending miscellaneous applications, if any, shall stand dosed. To,

1. The ll Additional Junior Civil J Magistrate, Medchal, CY,berabad. udge4unr-lX Additional Metropolitan

2. The Station House O,fficer, Pet Basheerabad Polie Station, Medcfial- 3. Two @s to tle Public Pro6ecubr, High Court for the State of Telangana at ,0. One @ to Sd Motrd Muzaffer Ullah lGan, Advocate{OPUCI 5. TnocDcopies vtrPsL b EIGT]I a a CRLP.No.{ {095 at Z0Zz f L!li c. 14 $lt:i 7W ( .* r i:,1 ALLOWING TFIE D \ "+,\