( 2025:JHHC:15953 ) 1 Cr. M.P. No.2844 of 2024 IN THE HIGH COURT OF JHARKHAND AT RANCHI Cr.M.P. No.2844 of 2024 ------ Jitendra Kumar Singh prop. J.K. Enterprises, aged about 50 years, son of Late Jangbahadur Singh, resident of J.C. Mallick Road, Preet Vihar Colony, P.O. and P.S. Hirapur, District Dhanbad, Jharkhand. … Petitioner Versus 1. The State of Jharkhand, and 2. Bhola Saw, son of Sri Durga Saw, resident of Shivam Colony, P.O.- K.G. Ashram, P.S. Saraidhela, District Dhanbad, Jharkhand. … Opposite Parties ------ For the Petitioner : Mr. Jay Shanker Tiwari, Advocate : Mr. Pratyush Shounikya, Advocate : Mr. Shubham Mayank, Advocate : Ms. Priya Sahay, Advocate : Mr. Manish Kumar, Advocate For the State : Mrs. Nehala Sharmin, Spl.P.P. For the OP 2 : Mr. Manoj Kr. Sinha, Advocate ------ P R E S E N T HON’BLE MR. JUSTICE ANIL KUMAR CHOUDHARY By the Court:- Heard the parties. 2. This Criminal Miscellaneous Petition has been filed invoking the jurisdiction of this Court under Section 528 of the B.N.S.S., 2023 with a prayer to quash and set aside the entire criminal proceeding arising out of C.P. Case No.9450 of 2023 for the offences punishable under Section 323, 420, 406 of the Indian Penal Code including the order taking cognizance dated 19.06.2024 passed by learned Judicial Magistrate-1st Class, Dhanbad whereby and where under the learned Judicial Magistrate-1st Class, Dhanbad has taken cognizance ( 2025:JHHC:15953 ) 2 Cr. M.P. No.2844 of 2024 for the offences punishable under Sections 323, 420, 406 of the Indian Penal Code against the petitioner. 3. The brief facts of the case is that the petitioner in need of money approached the informant to help him of Rs.40 lakhs, the complainant paid him in total 40 lakhs by paying Rs.20 lakhs on 26.06.2020 by transferring the same to the account of the petitioner and further paying another Rs.20 lakhs by RTGS. Though the petitioner promised to return the money after the corona pandemic ceases, but he did not pay the money even after that and though the complainant also issued a notice still the money was not paid. 4. Learned counsel for the petitioner relies upon the judgment of the Hon’ble Supreme Court of India in the case of Delhi Race Club (1940) Ltd. and Others v. State of Uttar Pradesh and Another reported in (2024) 10 SCC 690, paragraph-36 of which reads as under:- “43. There is a distinction between criminal breach of trust and cheating. For cheating, criminal intention is necessary at the time of making a false or misleading representation i.e. since inception. In criminal breach of trust, mere proof of entrustment is sufficient. Thus, in case of criminal breach of trust, the offender is lawfully entrusted with the property, and he dishonestly misappropriated the same. Whereas, in case of cheating, the offender fraudulently or dishonestly induces a person by deceiving him to deliver any property. In such a situation, both the offences cannot co-exist simultaneously.” and submits that both the offences punishable under Section 420 and 406 of the Indian Penal Code cannot co-exist simultaneously. 5. Learned counsel for the petitioner next relied upon the judgment of Hon’ble Supreme Court of India in the case of Rikhab Birani and Another vs. State of Uttar Pradesh and Another reported in 2025 SCC OnLine SC 823, paragraph-18 of which reads as under:- ( 2025:JHHC:15953 ) 3 Cr. M.P. No.2844 of 2024 “18. In Kunti v. State of Uttar Pradesh, this Court referred to Sarabjit Kaur v. State of Punjab wherein it was observed that a breach of contract does not give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction. Merely on the allegation of failure to keep a promise will not be enough to initiate criminal proceedings. Thus, the dishonest intention on the part of the party who is alleged to have committed the offence of cheating should be established at the time of entering into the transaction with the complainant, otherwise the offence of cheating is not established or made out.” and submits that in that case, the Hon’ble Supreme Court of India has also reiterated the settled principle of law that, merely the allegation of failure to keep a promise will not be enough to initiate criminal proceedings, hence, it is submitted that even if the entire allegations made against the petitioner are considered to be true in their entirety, still the offence punishable under Section 420 or 406 of the Indian Penal Code is not made out. It is next submitted that there is no allegation against the petitioner of causing hurt to the complainant or anyone else, hence, the offence punishable under Section 323 of the Indian Penal Code is also not made out. It is lastly submitted that the prayer, as prayed for in the instant Cr.M.P, be allowed. 6. Learned Spl.P.P. appearing for the State and the learned counsel for the opposite party No.2 on the other hand vehemently oppose the prayer of the petitioner made in the instant Cr.M.P and submit that as the petitioner dishonestly did not pay back the money taken by him, hence, both the offences punishable under Section 420 or 406 of the Indian Penal Code is made out. It is lastly submitted that this Cr.M.P., being without any merit, be dismissed. 7. Having heard the rival submissions made at the Bar and after carefully going through the materials available in the record, it is pertinent to mention here that mere breach of promise, agreement or contract does not ipso facto ( 2025:JHHC:15953 ) 4 Cr. M.P. No.2844 of 2024 constitute the offence of criminal breach of trust. It is also a settled principle of law that mere inability of the accused to return the loan amount cannot give rise to a criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction; as it is this mens rea which is the crux of the offence, as has been observed by the Hon’ble Supreme Court of India in the case of Satish Chandra Ratan Lal Shah vs. State of Gujarat & Anr. reported in (2019) 9 SCC 148, paragraph nos.13 of which reads as under:- 13. Now coming to the charge under Section 415 punishable under Section 420 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 Ranjan Prasad Verma v. State of Bihar [Hridaya Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168 : 2000 SCC (Cri) 786] .) In the case before us, admittedly the appellant was trapped in economic crisis and therefore, he had approached Respondent 2 to ameliorate the situation of crisis. Further, in order to recover the aforesaid amount, Respondent 2 had instituted a summary civil suit seeking recovery of the loan amount which is still pending adjudication. 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 is shown right at the beginning of the transaction, as it is 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 dishonest representation or inducement could be found or inferred.” (Emphasis supplied) 8. Now coming to the facts of the case, the only allegation against the petitioner is that the petitioner took loan, which he did not repay and there is no allegation against the petitioner of playing deception since the beginning of the transaction between the parties nor there is any allegation of dishonest misappropriation of any property by the petitioner. 9. Under Such circumstances, this court has no hesitation in holding that even if, the allegations against the petitioner are considered to be true in their ( 2025:JHHC:15953 ) 5 Cr. M.P. No.2844 of 2024 entirety, still the offence punishable under section 420 of the IPC or the offence punishable under Section 406 of IPC is made out and in the absence of any allegation against the petitioner of causing hurt to anyone, the offence punishable under Section 323 is not made out as well. Hence, this Court is of the considered view that the continuation of this criminal proceeding against the petitioner will amount to abuse of process of law and this is a fit case where the entire criminal proceeding arising out of C.P. Case No.9450 of 2023 for the offences punishable under Section 323, 420, 406 of the Indian Penal Code including the order taking cognizance dated 19.06.2024 passed by learned Judicial Magistrate-1st Class, Dhanbad, be quashed and set aside. 10. Accordingly, the entire criminal proceeding arising out of C.P. Case No.9450 of 2023 for the offences punishable under Section 323, 420, 406 of the Indian Penal Code including the order taking cognizance dated 19.06.2024 passed by learned Judicial Magistrate-1st Class, Dhanbad, is quashed and set aside qua the petitioner only. 11. In the result, this Cr.M.P., stands allowed. (Anil Kumar Choudhary, J.) High Court of Jharkhand, Ranchi Dated the 17th of June, 2025 AFR/ Abhiraj