[2026:JHHC:14514] 1 Cr.M.P. No. 1207 of 2026 IN THE HIGH COURT OF JHARKHAND AT RANCHI Cr.M.P. No. 1207 of 2026 Jyoti Kumar Diwakar, aged about 40 years, son of Nand Kishor Das, resident of Qr. No. 4038, Sector-12C, Bokaro Steel City, P.O:- Bokaro, P.S:- Bokaro Steel City, District: Bokaro, State: Jharkhand. ...... Petitioner Versus The State of Jharkhand ….. Opposite Party For the Petitioner : Mr. Ankur Anand , Adv. For the State : Mr. Rajesh Kumar , Addl. PP 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 BNSS 2023 with the prayer for quashing and setting aside the FIR being B.S. City P.S. case no. 37 of 2024 registered for the offence punishable under Section 406/420 of IPC, presently pending in the court of learned JMFC, Bokaro. 3. Learned counsel for the petitioner submits that the investigation of the case is still going on and the charge sheet has not yet been submitted. 4. The allegation against the petitioner is that the petitioner took a loan of Rs. 8,00,000/- from the informant and to repay the loan, issued cheques twice but the cheques were dishonoured. Relying upon the judgment of the Hon’ble Supreme Court of India in the case of Binod Kumar and Others v. State of Bihar and Another reported in (2014) 10 SCC 663, para 18 of which reads as under :- “18. In the present case, looking at the allegations in the complaint on the face of it, we find that no allegations are made attracting the ingredients of Section 405 IPC. Likewise, there are no allegations as to cheating or the dishonest intention of the appellants in retaining the money in order to have wrongful [2026:JHHC:14514] 2 Cr.M.P. No. 1207 of 2026 gain to themselves or causing wrongful loss to the complainant. Excepting the bald allegations that the appellants did not make payment to the second respondent and that the appellants utilised the amounts either by themselves or for some other work, there is no iota of allegation as to the dishonest intention in misappropriating the property. To make out a case of criminal breach of trust, it is not sufficient to show that money has been retained by the appellants. It must also be shown that the appellants dishonestly disposed of the same in some way or dishonestly retained the same. The mere fact that the appellants did not pay the money to the complainant does not amount to criminal breach of trust.”(Emphasis supplied) learned counsel for the petitioner submits that therein, it has categorically been reiterated by the Hon’ble Supreme Court of India that to make out a case of criminal breach of trust, it is not sufficient to show that money has been retained by the accused persons. It must also be shown that the accused persons dishonestly disposed of the same in some way or dishonestly retained the same. The mere fact that the accused persons did not repay the money to the complainant does not amount to criminal breach of trust. It is next submitted that in this case, the only allegation is that though the petitioner attempted to pay back the money by way of cheques but the cheques were dishonoured. So, in this case the offence punishable under Section 406 of IPC will not be made out even if the entire allegations made against the petitioner are considered to be true in their entirety. 5. Learned counsel for the petitioner next relies upon the judgment of the Hon’ble Supreme Court of India in the case Uma Shankar Gopalika vs. State of Bihar & Another reported in (2005) 10 SCC 336 paragraph-6 of which reads as under:- 6. “Xxxx xxxx xxxx It is well settled that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception. If the intention to cheat has developed later on, the same cannot amount to cheating. In the present case it has nowhere been stated that at the very inception there was any intention on behalf of the accused persons to cheat which is a condition precedent for an offence under Section 420 IPC.” (Emphasis supplied) [2026:JHHC:14514] 3 Cr.M.P. No. 1207 of 2026 wherein the Hon’ble Supreme Court of India reiterated the settled principle of law that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception. If the intention to cheat has developed later on, the same cannot amount to cheating. 6. It is next submitted that there is absolutely no allegation against the petitioner that the petitioner played deception since the beginning of the transaction between the parties hence even if the entire allegations made against the petitioner considered to be true in their entirety still the offence punishable under Section 420 of IPC will not be made out. 7. Learned counsel for the petitioner next relies upon the judgment of the Hon’ble Supreme Court of India in the case of Medchl Chemicals & Pharma (P) Ltd. Vs. Biological E. Ltd. and Others reported in (2000) 3 SCC 269 and submits that in para 11 thereof, it has been observed that the mens rea is one of the essential ingredients of cheating punishable under Section 420 of IPC and in order to attract the provisions of offence punishable under Section 418 and 420 of IPC, the guilty intent of making the promise is a requirement and an essential ingredient thereto and subsequent failure to fulfil the promise by itself would not attract the provision of Section 418 of IPC or Section 420 of IPC and submits that in this case, there is no allegation of guilty intent of the petitioner, hence, the offence punishable under Section 420 of IPC is not made out. 8. Learned counsel for the petitioner next relies upon the judgment of a co-ordinate Bench of this Court in the case of Prashant Mohan Nayak @ Prashant M Nayak vs. State of Jharkhand & Another reported in 2020:JHHC:16212. 9. It is lastly submitted that even if the entire allegations against the petitioner are considered to be true in their entirety still neither the offence punishable under Section 418 nor the offence punishable under Section 420 of IPC is made out against the [2026:JHHC:14514] 4 Cr.M.P. No. 1207 of 2026 petitioner, hence, it is submitted that the prayer as made in this criminal miscellaneous petition be allowed. 10. Learned Addl. PP on the other hand vehemently oppose the prayer of the petitioner and submits that the materials in the record are sufficient to constitute both the offence punishable under Section 406 of IPC as well as the offence punishable under Section 420 of IPC and the petitioner has not appeared before learned trial court though his Anticipatory Bail Application has been rejected twice by this Court, hence it is submitted that this Criminal Miscellaneous Petition being without any merit, be dismissed. 11. Having heard the submissions made at the Bar and after going through materials available in the record, it is pertinent to mention here that it is a settled principle of law as has been reiterated 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 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.” wherein it has categorically been held that mere inability of the accused person 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. [2026:JHHC:14514] 5 Cr.M.P. No. 1207 of 2026 12. Now coming to the facts of the case, the only allegation against the petitioner is that the petitioner took loan from the informant but did not repay the same during the time, within which he promised to repay and when the informant demanded his money back, the petitioner issued cheques on two separate occasions for the loan amount taken by him but the cheques were dishonoured. 13. Further, there is no allegation against the petitioner that the petitioner played deception since the beginning of the transaction between the parties nor there is any allegation of the petitioner playing deception or having intention to cheat since the beginning of the transaction between the parties and in the absence of the same, this Court is of the considered view that even if the entire allegations are considered to be true in its entirety still neither the offence punishable under Section 406 of IPC nor the offence punishable under Section 420 of IPC is made out against the petitioner, hence, continuation of this criminal proceeding against the petitioner will amount to abuse of process of law. Therefore, this is a fit case where the FIR being B.S. City P.S. case no. 37 of 2024 be quashed and set aside qua the petitioner. 14. Accordingly, the FIR being B.S. City P.S. case no. 37 of 2024, is quashed and set aside qua the petitioner. 15. In the result, this Criminal Miscellaneous Petition is allowed. (Anil Kumar Choudhary, J.) High Court of Jharkhand, Ranchi Dated, the 29th April, 2026 Smita /AFR Uploaded on 14.05.2026