JUDGMENT : Rakesh Kainthla, J. The present revision is directed against the order dated 15.10.2025, passed by learned Additional Chief Judicial Magistrate, Court No.1, Solan, HP (learned Trial Court), vide which the complaint filed by the petitioner (applicant before the learned Trial Court) under Section 175(3) of Bhartiya Nagrik Suraksha Sanhita, 2023 (BNSS) was dismissed. (Parties shall hereinafter be referred to in the same manner as they were arrayed before the learned Trial Court for convenience.) 2. Briefly stated, the facts giving rise to the present petition are that the applicant filed an application before the learned Trial Court for issuing a direction to the Station House Officer, Police Station, Sadar, Solan, HP, to register the FIR against the accused under Section 175(3) of BNSS. It was asserted that accused No. 1 is working as Managing Director in Baghat Urban Cooperative Bank Limited, whereas accused No.2 is working as a Manager in the Branch of Baghat Urban Cooperative Bank Limited, Chowk Bazar, Solan. HP. The applicant approached the Bank for financial assistance in the year 2011. The bank sanctioned a term loan of Rs. 12.00 lacs to the applicant, which was to be repaid in 60 monthly equated installments of Rs. 27,250/-subject to the floating rate of interest as per the directions issued by the Reserve Bank of India from time to time. The applicant paid some installments, but could not pay the remaining installments because of financial crises. The accused added wrong and illegal overdues to the applicant’s loan account. The applicant deposited money in his account, but it was adjusted against wrong and illegal deductions. The accused initiated proceedings under the SARFAESI Act and took the symbolic possession of the mortgaged property. The accused No.1 issued a loan account statement showing a balance of Rs. 12,84,327.17 on 10.6.2022. The applicant transferred Rs. 6.00 lacs on 13.7.2022 and Rs. 7,80,000/- on 14.7.2022 to the account of the accused. He requested accused No.1 to adjust the entire loan amount and issue a no-objection certificate. The accused, in collusion with each other, adjusted Rs. 6,00,000/- on 14.7.202 and Rs. 6,80,000/- on 15.7.2022. The applicant had deposited the excess money (Rs. 1.00 lac) in his account, but his loan account was not cleared. The applicant applied for documents under the Right to Information Act, but the accused withheld the applicant’s loan statement. The amount of Rs. The accused, in collusion with each other, adjusted Rs. 6,00,000/- on 14.7.202 and Rs. 6,80,000/- on 15.7.2022. The applicant had deposited the excess money (Rs. 1.00 lac) in his account, but his loan account was not cleared. The applicant applied for documents under the Right to Information Act, but the accused withheld the applicant’s loan statement. The amount of Rs. 1.00 lac was adjusted against the wrong deduction, and the overdue amount of Rs. 1,51,026/- was shown. The applicant issued a legal notice to the bank, and the bank sent a reply claiming an amount of Rs. 14,762/-. The proceedings under the SARFAESI Act were wrongly initiated. The applicant filed a consumer complaint against the bank for a deficiency in service. He also filed a complaint before the Superintendent of Police, Solan and Station House Officer, Sadar, Solan, HP, for taking action against the accused, but no action was taken. Hence, it was prayed that the action be taken against the accused. 3. Learned Trial Court held that the complaint should disclose the commission of a cognizable offence before it can be referred to the police for investigation. The application in the present case disclosed a civil dispute between the parties regarding the adjustment of the amount paid by the applicant. Civil breach of contract or financial irregularity does not constitute a criminal offence. No prima facie case was made out for taking action as per the law. Hence, the application was dismissed. 4. Being aggrieved by the order passed by the learned Trial Court, the petitioner/applicant has filed the present petition asserting that the statement of account showed an outstanding amount of Rs. 12,84,327.74 on 13.4.2022. The applicant deposited an amount of Rs. 13,80,000/-. The bank was bound to issue a No Objection Certificate (NOC) in the applicant’s favour. The applicant had also filed a complaint before the Consumer Commission, Solan. The accused initiated proceedings under the SARFAESI Act to harm the applicant’s reputation. The loan availed by the applicant is not disputed. It is also not disputed that the amount of Rs. 13,80,000/- was paid by the applicant. The subsequent adjustments are wrong and against the law. The accused are the employees of Baghat Urban Cooperative Bank, and they were bound to discharge their duties as per the instructions issued by the Reserve Bank of India. It is also not disputed that the amount of Rs. 13,80,000/- was paid by the applicant. The subsequent adjustments are wrong and against the law. The accused are the employees of Baghat Urban Cooperative Bank, and they were bound to discharge their duties as per the instructions issued by the Reserve Bank of India. Learned Trial Court erred in holding that no offence is made out against the accused. Therefore, it was prayed that the present petition be allowed and the order passed by the learned Trial Court be set-aside. 5. Mr Akshay Katoch, learned counsel for the petitioner/applicant, submitted that the learned Trial Court erred in dismissing the application. The applicant had deposited Rs. 13,80,000/- against the outstanding amount of Rs. 12,84,327.74/-, and he was entitled to a no-objection certificate. The accused adjusted the amount deposited by the applicant against the heads not mentioned in the agreement. This constituted offences punishable under Sections 406 and 420 of the IPC. Learned Trial Court failed to appreciate this aspect. Hence, he prayed that the present petition be allowed and the order passed by the learned Trial Court be set aside. 6. I have given considerable thought to the submissions made at the bar and have gone through the records carefully. 7. It was submitted that the application discloses the commission of offences punishable under Sections 406 and 420 of the IPC. This submission is not acceptable. It was laid down by the Hon’ble Supreme Court in Lalit Chaturvedi v. State of U.P., 2024 SCC OnLine SC 171 that the same act of transaction cannot result in an offence of cheating and criminal breach of trust. It was observed: - 10. The chargesheet also refers to Section 406 of the IPC, but without pointing out how the ingredients of said section are satisfied. No details and particulars are mentioned. There are decisions that hold that the same act or transaction cannot result in an offence of cheating and criminal breach of trust simultaneously. Wolfgang Reim v. State, 2012 SCC OnLine Del 3341; Mahindra and Mahindra Financial Services Ltd. v. Delta Classic (P.) Ltd., (2011) 6 Gau LR 604; Mukesh Sharma v. State of Himachal Pradesh, 2024: HHC: 35. There are decisions that hold that the same act or transaction cannot result in an offence of cheating and criminal breach of trust simultaneously. Wolfgang Reim v. State, 2012 SCC OnLine Del 3341; Mahindra and Mahindra Financial Services Ltd. v. Delta Classic (P.) Ltd., (2011) 6 Gau LR 604; Mukesh Sharma v. State of Himachal Pradesh, 2024: HHC: 35. For the offence of cheating, dishonest intention must exist at the inception of the transaction, whereas, in case of criminal breach of trust there must exist a relationship between the parties whereby one party entrusts another with the property as per law, albeit dishonest intention comes later. In this case, entrustment is missing; in fact, it is not even alleged. It is a case of the sale of goods. The chargesheet does refer to Section 506 of the IPC, relying upon the averments in the complaint. However, no details and particulars are given, when and on which date and place the threats were given. Without the said details and particulars, it is apparent to us that these allegations of threats, etc., have been made only with the intent to activate police machinery for the recovery of money. 8. This position was reiterated in Delhi Race Club (1940) Ltd. v. State of U.P., (2024) 10 SCC 690 , and it was held that an offence of cheating and criminal breach of trust is independent and distinct. They cannot coexist similarly in the same set of facts. It was observed: - “43. There is a distinction between criminal breach of trust and cheating. For cheating, the criminal intention is necessary at the time of making a false or misleading representation, i.e. since inception. In a 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 misappropriates the same. Whereas, in the case of cheating, the offender fraudulently or dishonestly induces a person by deceiving him to deliver any property. In such a situation, both offences cannot co-exist simultaneously. 55. It is high time that police officers across the country are imparted proper training in law to understand the fine distinction between the offence of cheating vis-à-vis criminal breach of trust. Both offences are independent and distinct. The two offences cannot coexist simultaneously in the same set of facts. They are antithetical to each other. 55. It is high time that police officers across the country are imparted proper training in law to understand the fine distinction between the offence of cheating vis-à-vis criminal breach of trust. Both offences are independent and distinct. The two offences cannot coexist simultaneously in the same set of facts. They are antithetical to each other. The two provisions of IPC (now BNS, 2023) are not twins, and they cannot survive without each other.” 9. Hence, the submission that the accused have committed offences punishable under Sections 406 and 420 of the IPC cannot be accepted. 10. In the present case, the application does not mention that any misrepresentation was made to the applicant by any person. The petitioner/applicant stated in para-5 of the application that he had approached accused No.1 to repay the entire loan in a single instalment. The accused no. 1 issued a loan account statement (Annexure P-1) disclosing that an amount of Rs. 12,84,327.17 was outstanding on 10.6.2022. The statement of account (Annexure P-5) also shows an amount of Rs. 12,84,327.74 due on 10.6.2022. Thereafter, various amounts have been shown to be deposited in the account, and still an amount of Rs. 2,84,427/-was shown due on 15.7.2022. Various amounts were added subsequently. Therefore, the statement of account does not show that the amount deposited by the petitioner was not credited to his account. The grievance of the petitioner is that the charges were wrongly reflected in the statements of account. This is purely a civil dispute and has to be determined with reference to the agreement executed between the parties. Even if there is some error, the same would not constitute any misrepresentation on behalf of accused No. 1, justifying the initiation of criminal proceedings. 11. The allegations in the application disclose a dispute regarding the deduction made by the bank. Learned Trial Court had rightly held that it was a civil dispute and could not be investigated by the police. It is undisputed that a consumer complaint has been filed before the Consumer Commission at Solan, which also shows that the dispute is civil in nature. 12. It was laid down by the Hon’ble Supreme Court in Anukul Singh v. State of U.P., 2025 SCC OnLine SC 2060, that criminal proceedings cannot be used for enforcing civil rights. It was observed: - 17. 12. It was laid down by the Hon’ble Supreme Court in Anukul Singh v. State of U.P., 2025 SCC OnLine SC 2060, that criminal proceedings cannot be used for enforcing civil rights. It was observed: - 17. This Court has, in a long line of decisions, deprecated the tendency to convert civil disputes into criminal proceedings. In Indian Oil Corporation v. NEPC India Ltd. (2006) 6 SCC 736 , it was held that criminal law cannot be used as a tool to settle scores in commercial or contractual matters, and that such misuse amounts to abuse of process. The following paragraphs from the decision are apposite: “9. The principles relevant to our purpose are: (i) A complaint can be quashed where the allegations made in the complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie constitute any offence or make out the case alleged against the accused. For this purpose, the complaint has to be examined as a whole, but without examining the merits of the allegations. Neither a detailed inquiry nor a meticulous analysis of the material nor an assessment of the reliability or genuineness of the allegations in the complaint is warranted while examining a prayer for quashing of a complaint. (ii) A complaint may also be quashed where it is a clear abuse of the process of the court, as when the criminal proceeding is found to have been initiated with malafides/malice for wreaking vengeance or to cause harm, or where the allegations are absurd and inherently improbable. (iii) The power to quash shall not, however, be used to stifle or scuttle a legitimate prosecution. The power should be used sparingly and with abundant caution. (iv) The complaint is not required to verbatim reproduce the legal ingredients of the offence alleged. If the necessary factual foundation is laid in the complaint, merely on the ground that a few ingredients have not been stated in detail, the proceedings should not be quashed. Quashing of the complaint is warranted only where the complaint is so bereft of even the basic facts that are necessary for making out the offence. (v) A given set of facts may make out: (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. Quashing of the complaint is warranted only where the complaint is so bereft of even the basic facts that are necessary for making out the offence. (v) A given set of facts may make out: (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. A commercial transaction or a contractual dispute, apart from furnishing a cause of action for seeking a remedy in civil law, may also involve a criminal offence. As the nature and scope of a civil proceeding are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal offence or not. 10. While on this issue, it is necessary to take notice of a growing tendency in business circles to convert purely civil disputes into criminal cases. This is obviously on account of a prevalent impression that civil law remedies are time-consuming and do not adequately protect the interests of lenders/creditors. Such a tendency is seen in several family disputes, also leading to an irretrievable breakdown of marriages/families. There is also an impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle civil disputes and claims, which do not involve any criminal offence, by applying pressure through criminal prosecution should be deprecated and discouraged.” 18. Similarly, in Inder Mohan Goswami v. State of Uttaranchal (2007) 12 SCC 1 : AIR 2008 SC 251 , it was emphasised that criminal prosecution must not be permitted as an instrument of harassment or private vendetta. In Ganga Dhar Kalita v. State of Assam (2015) 9 SCC 647 , this Court again reiterated that criminal complaints in respect of property disputes of a civil nature, filed solely to harass the accused or to exert pressure in civil litigation, constitute an abuse of process. 19. In Ganga Dhar Kalita v. State of Assam (2015) 9 SCC 647 , this Court again reiterated that criminal complaints in respect of property disputes of a civil nature, filed solely to harass the accused or to exert pressure in civil litigation, constitute an abuse of process. 19. Most recently, in Shailesh Kumar Singh @ Shailesh R. Singh v. State of Uttar Pradesh 2025 INSC 869 , this Court disapproved the practice of using criminal proceedings as a substitute for civil remedies, observing that money recovery cannot be enforced through criminal prosecution where the dispute is essentially civil. The Court cautioned High Courts not to direct settlements in such matters but to apply the settled principles in Bhajan Lal. The following paragraphs are relevant in this context: “9. What we have been able to understand is that there is an oral agreement between the parties. The Respondent No. 4 might have parted with some money in accordance with the oral agreement, and it may be that the appellant, herein, owes a particular amount to be paid to the Respondent No. 4. However, the question is whether, prima facie, any offence of cheating could be said to have been committed by the appellant. 10. How many times are the High Courts to be reminded that to constitute an offence of cheating, there has to be something more than prima facie on record to indicate that the intention of the accused was to cheat the complainant right from the inception. The plain reading of the FIR does not disclose any element of criminality. 11. The entire case is squarely covered by a recent pronouncement of this Court in the case of “Delhi Race Club (1940) Limited v. State of Uttar Pradesh”, (2024) 10 SCC 690 . In the said decision, the entire law as to what constitutes cheating and criminal breach of trust, respectively, has been exhaustively explained. It appears that this very decision was relied upon by the learned counsel appearing for the petitioner before the High Court. However, instead of looking into the matter on its own merits, the High Court thought fit to direct the petitioner to go for mediation and that too by making payment of Rs. 25,00,000/- to the 4th respondent as a condition precedent. We fail to understand why the High Court should undertake such an exercise. However, instead of looking into the matter on its own merits, the High Court thought fit to direct the petitioner to go for mediation and that too by making payment of Rs. 25,00,000/- to the 4th respondent as a condition precedent. We fail to understand why the High Court should undertake such an exercise. The High Court may either allow the petition, saying that no offence is disclosed or may reject the petition, saying that no case for quashing is made out. Why should the High Court attempt to help the complainant to recover the amount due and payable by the accused? It is for the Civil Court or Commercial Court, as the case may be, to look into a suit that may be filed for recovery of money or in any other proceedings, be it under the Arbitration Act, 1996 or under the provisions of the IB Code, 2016. 12. Why the High Court was not able to understand that the entire dispute between the parties is of a civil nature. 13. We also enquired with the learned counsel appearing for the Respondent No. 4 whether his client has filed any civil suit or has initiated any other proceedings for recovery of the money. It appears that no civil suit has been filed for the recovery of money to date. Money cannot be recovered, more particularly, in a civil dispute between the parties by filing a First Information Report and seeking the help of the Police. This amounts to abuse of the process of law. 14. We could have said many things, but we refrain from observing anything further. If the Respondent No. 4 has to recover a particular amount, he may file a civil suit or seek any other appropriate remedy available to him in law. He cannot be permitted to take recourse to criminal proceedings. 15. We are quite disturbed by the manner in which the High Court has passed the impugned order. The High Court first directed the appellant to pay Rs. 25,00,000/- to the Respondent No. 4 and thereafter directed him to appear before the Mediation and Conciliation Centre for settlement. He cannot be permitted to take recourse to criminal proceedings. 15. We are quite disturbed by the manner in which the High Court has passed the impugned order. The High Court first directed the appellant to pay Rs. 25,00,000/- to the Respondent No. 4 and thereafter directed him to appear before the Mediation and Conciliation Centre for settlement. That's not what is expected of a High Court to do in a Writ Petition filed under Article 226 of the Constitution or a miscellaneous application filed under Section 482 of the Criminal Procedure Code, 1973, for quashing of FIR or any other criminal proceedings. What is expected of the High Court is to look into the averments and the allegations levelled in the FIR, along with the other material on record, if any. The High Court seems to have forgotten the well-settled principles as enunciated in the decision of this Court in the “State of Haryana v. Bhajan Lal”, 1992 Supp (1) SCC 335. 13. Hon’ble Supreme Court held in Kapil Agarwal vs. Sanjay Sharma, (2021) 5 SCC 524 : 2021 SCC OnLine SC 154 that criminal proceedings cannot be permitted to become a weapon of harassment. It was observed: “18.1. As observed and held by this Court in a catena of decisions, inherent jurisdiction under Section 482 CrPC and/or under Article 226 of the Constitution is designed to achieve a salutary purpose that criminal proceedings ought not to be permitted to degenerate into weapons of harassment. When the Court is satisfied that criminal proceedings amount to an abuse of process of law or that it amounts to bringing pressure upon the accused, in the exercise of inherent powers, such proceedings can be quashed.” 14. Thus, the learned Trial Court was justified in refusing to refer the matter to the police for investigations. 15. The application does not mention that the amount was deposited with accused Nos. 1 and 2; rather, it mentions that the amount was deposited with the bank, which was duly reflected in the statements of account. Therefore, no offence of criminal breach of trust was made out against the accused. 16. In view of the above, no fault can be found with the order passed by the learned Trial Court. Hence, the present petition fails, and it is dismissed.