Khurshid Ahmad v. Mohd. Danish). This order is the subject matter of challenge before this Court

1. Heard Shri Dileep Kumar Srivastava, learned counsel for the applicant, Shri Rajesh Kumar Singh, learned counsel for the Opposite Party No.2 and learned AGA for the State.

2. The allegations made in the complaint dated 30.09.2022 instituted by the opposite party No.2 is that in the year 2020 a contract was executed between the parties for supplying 'Sarees' to the applicant's firm to the tune of Rs.10 Lakhs, which as per the assertion in the complaint was paid by the applicant. It is thereafter from 01.10.2020 to 11.11.2020 different varieties of Sarees costing Rs.8,50,000/- were supplied, however, thereafter the due amount for the payment of Sarees and the commission, as is agreed between the parties, was not paid and even on repeated oral demands and through mobile, the applicant gave false assurances stating that by 31.05.2022, he shall return the entire amount.

3. Further allegations have been made in complaint, which suggests that the amount was not returned and on repeated demands the complainant was subjected to foul language and threats. The said complaint was in the form of an application under Section 156(3) Cr.P.C., which was treated as a complaint, after which the statement of opposite party No.2 was recorded under Section 200 Cr.P.C., in which similar assertion was made as made in the complaint. Statement of Mohd. Amir was recorded under Section 202 Cr.P.C.

4. The documentary evidence in the form of certain invoice and a 2 A482 No. 28670 of 2024 complaint made to the Superintendent of Police dated 29.08.2022 were also filed before the Learned Magistrate. The Learned Magistrate by means of the impugned order dated 15.05.2024 summoned the applicant to face trial for offences under Section 420, 504 and 506 IPC in Complaint Case No.5383 of 2022 (Khurshid Ahmad vs. Mohd. Danish). This order is the subject matter of challenge before this Court.

5. The pleadings in the matter have been exchanged. I have heard Learned Counsels for the parties and perused the record.

6. Learned counsel for the applicant submits that a commercial transaction, which has been made the basis of the present complaint, does not make out a case of cheating. A purely civil dispute is being converted into a criminal case and the Learned Magistrate has wrongly summoned the applicants for the offences under Sections 420, 504, 506 IPC. He further submits that there was no subsequent transaction of Rs.8,50,000/- and a computer bill has been copied and misused to set up a false claim.

7. Learned counsel for the opposite party No.2 has, on the contrary, submitted that the complaint clearly makes out a case of cheating and the Learned Magistrate has rightly summoned the applicant to face trial. He further submitted that the intent of the applicant was to cheat and he has accepted the goods and thereafter failed to make payment of the amount due. This clearly makes out a case of cheating and the application deserves to be dismissed.

8. Learned AGA also supports the stand taken by the Learned counsel for the opposite party No.2.

9. I have considered the rival submissions of the parties.

10. A bare perusal of the complaint and its material including the statement of witnesses as well as the summoning order clearly indicate that this is a dispute in which a simple monetary transaction has been converted to a criminal dispute. From the perusal of the record no offence under Section 420 IPC is made out, as a simple trade and thereafter non payment of money/commission due would not make out a case of cheating. It is admitted by the complainant himself that the earlier transaction amounting to Rs.10 Lakhs was duly honoured by the applicant. Later-on he did not fulfill his part of the contract and violated 3 A482 No. 28670 of 2024 the terms by non payment of the amount due. This fact in itself does not make out a criminal case and the cognizance and summoning under Section 420 IPC is bad in law on the facts of the case.

11. The Hon’ble Supreme Court in the case of Manish vs. State of Maharashtra and another 2025 INSC 430, while considering the impact of commercial transactions giving rise to criminal offence in addition to civil cause of action, taking into note the provisions of Section 415 IPC illustration (g), held: “14. There is no cavil that in some cases a commercial dispute may give rise to a criminal offence in addition to a civil cause of action. The test to determine whether a case would attract penal consequences is as follows:- “Did the offending party make dishonest representation at the inception of the transaction and induce the other party to part with property, or act in a manner which but for such representation, the latter would not have done.”

15. This fine distinction is brought out in illustration (g) of Section 415 of IPC which reads as follows:- “(g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo plant which he does not intend to deliver, and thereby dishonestly induces Z to advance money upon the faith of such delivery. A cheats; but if A, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to a civil action for breach of contract.”

12. As stated above, the first transaction of Rs.10 lakhs was duly honoured with all honesty, as is the assertion in the complaint itself. The subsequent transaction and non payment of money would not make out a cause for criminal action but may very well justify a civil action for recovery of money. The applicant has although denied any liability stating that the claim is being made on the basis of a copied computer bill and misuse thereof, as stated in paragraph No.11 of the affidavit accompanying the application under Section 482 Cr.P.C. This also would not help the complainant’s case, inasmuch as the summoning order and the continuation of proceedings must be justified on the assertions made in the complaint and material collected during inquiry and not on the stand taken by the applicant while challenging the proceedings before the superior courts. 4 A482 No. 28670 of 2024

13. The allegations with respect to offences under Section 504 and 506 IPC are similarly not made out as the specific case, which has been set up of reaching the house of the applicant in the company of Dilshad Ahmad, Mohd. Amir and Aftab Ahmad at 9 AM in the morning where the applicant refused to return the money and also allegedly abused the complainant, seem to have been levelled only to increase the gravity of the case. Out of the three people mentioned above, Mohd. Amir has been produced as PW-1 and in his statement the allegations, which are not mentioned in the complaint, have been levelled, which prima facie indicates that the allegations are being moulded to suit the prosecution version and do not inspire confidence. As such, the Court would not be justified in summoning for offences under Section 504 and 506 IPC.

14. In these circumstances, the impugned summoning order dated

15.05.2024 and the entire proceedings of Complaint Case No. 5383 of 2022 (Khurshid Ahmad vs Mohd. Danish) under Sections 420, 504, 506 IPC, P.S. Kotwali Mau, District Mau are quashed.

15. The Application U/s 482 stands allowed. October 8, 2025 A. Pandey (Rajiv Lochan Shukla,J.) ANAND PANDEY High Court of Judicature at Allahabad

1. Heard Shri Dileep Kumar Srivastava, learned counsel for the applicant, Shri Rajesh Kumar Singh, learned counsel for the Opposite Party No.2 and learned AGA for the State.

2. The allegations made in the complaint dated 30.09.2022 instituted by the opposite party No.2 is that in the year 2020 a contract was executed between the parties for supplying 'Sarees' to the applicant's firm to the tune of Rs.10 Lakhs, which as per the assertion in the complaint was paid by the applicant. It is thereafter from 01.10.2020 to 11.11.2020 different varieties of Sarees costing Rs.8,50,000/- were supplied, however, thereafter the due amount for the payment of Sarees and the commission, as is agreed between the parties, was not paid and even on repeated oral demands and through mobile, the applicant gave false assurances stating that by 31.05.2022, he shall return the entire amount.

3. Further allegations have been made in complaint, which suggests that the amount was not returned and on repeated demands the complainant was subjected to foul language and threats. The said complaint was in the form of an application under Section 156(3) Cr.P.C., which was treated as a complaint, after which the statement of opposite party No.2 was recorded under Section 200 Cr.P.C., in which similar assertion was made as made in the complaint. Statement of Mohd. Amir was recorded under Section 202 Cr.P.C.

4. The documentary evidence in the form of certain invoice and a 2 A482 No. 28670 of 2024 complaint made to the Superintendent of Police dated 29.08.2022 were also filed before the Learned Magistrate. The Learned Magistrate by means of the impugned order dated 15.05.2024 summoned the applicant to face trial for offences under Section 420, 504 and 506 IPC in Complaint Case No.5383 of 2022 (Khurshid Ahmad vs. Mohd. Danish). This order is the subject matter of challenge before this Court.

5. The pleadings in the matter have been exchanged. I have heard Learned Counsels for the parties and perused the record.

6. Learned counsel for the applicant submits that a commercial transaction, which has been made the basis of the present complaint, does not make out a case of cheating. A purely civil dispute is being converted into a criminal case and the Learned Magistrate has wrongly summoned the applicants for the offences under Sections 420, 504, 506 IPC. He further submits that there was no subsequent transaction of Rs.8,50,000/- and a computer bill has been copied and misused to set up a false claim.

7. Learned counsel for the opposite party No.2 has, on the contrary, submitted that the complaint clearly makes out a case of cheating and the Learned Magistrate has rightly summoned the applicant to face trial. He further submitted that the intent of the applicant was to cheat and he has accepted the goods and thereafter failed to make payment of the amount due. This clearly makes out a case of cheating and the application deserves to be dismissed.

8. Learned AGA also supports the stand taken by the Learned counsel for the opposite party No.2.

9. I have considered the rival submissions of the parties.

10. A bare perusal of the complaint and its material including the statement of witnesses as well as the summoning order clearly indicate that this is a dispute in which a simple monetary transaction has been converted to a criminal dispute. From the perusal of the record no offence under Section 420 IPC is made out, as a simple trade and thereafter non payment of money/commission due would not make out a case of cheating. It is admitted by the complainant himself that the earlier transaction amounting to Rs.10 Lakhs was duly honoured by the applicant. Later-on he did not fulfill his part of the contract and violated 3 A482 No. 28670 of 2024 the terms by non payment of the amount due. This fact in itself does not make out a criminal case and the cognizance and summoning under Section 420 IPC is bad in law on the facts of the case.

11. The Hon’ble Supreme Court in the case of Manish vs. State of Maharashtra and another 2025 INSC 430, while considering the impact of commercial transactions giving rise to criminal offence in addition to civil cause of action, taking into note the provisions of Section 415 IPC illustration (g), held: “14. There is no cavil that in some cases a commercial dispute may give rise to a criminal offence in addition to a civil cause of action. The test to determine whether a case would attract penal consequences is as follows:- “Did the offending party make dishonest representation at the inception of the transaction and induce the other party to part with property, or act in a manner which but for such representation, the latter would not have done.”

15. This fine distinction is brought out in illustration (g) of Section 415 of IPC which reads as follows:- “(g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo plant which he does not intend to deliver, and thereby dishonestly induces Z to advance money upon the faith of such delivery. A cheats; but if A, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to a civil action for breach of contract.”

12. As stated above, the first transaction of Rs.10 lakhs was duly honoured with all honesty, as is the assertion in the complaint itself. The subsequent transaction and non payment of money would not make out a cause for criminal action but may very well justify a civil action for recovery of money. The applicant has although denied any liability stating that the claim is being made on the basis of a copied computer bill and misuse thereof, as stated in paragraph No.11 of the affidavit accompanying the application under Section 482 Cr.P.C. This also would not help the complainant’s case, inasmuch as the summoning order and the continuation of proceedings must be justified on the assertions made in the complaint and material collected during inquiry and not on the stand taken by the applicant while challenging the proceedings before the superior courts. 4 A482 No. 28670 of 2024

13. The allegations with respect to offences under Section 504 and 506 IPC are similarly not made out as the specific case, which has been set up of reaching the house of the applicant in the company of Dilshad Ahmad, Mohd. Amir and Aftab Ahmad at 9 AM in the morning where the applicant refused to return the money and also allegedly abused the complainant, seem to have been levelled only to increase the gravity of the case. Out of the three people mentioned above, Mohd. Amir has been produced as PW-1 and in his statement the allegations, which are not mentioned in the complaint, have been levelled, which prima facie indicates that the allegations are being moulded to suit the prosecution version and do not inspire confidence. As such, the Court would not be justified in summoning for offences under Section 504 and 506 IPC.

14. In these circumstances, the impugned summoning order dated

15.05.2024 and the entire proceedings of Complaint Case No. 5383 of 2022 (Khurshid Ahmad vs Mohd. Danish) under Sections 420, 504, 506 IPC, P.S. Kotwali Mau, District Mau are quashed.

15. The Application U/s 482 stands allowed. October 8, 2025 A. Pandey (Rajiv Lochan Shukla,J.) ANAND PANDEY High Court of Judicature at Allahabad