HIGH COURT OF JUDICATURE AT ALLAHABAD APPLICATION U/S 528 BNSS No. - 18410 of 2026 Court No. - 77 HON'BLE SAURABH SRIVASTAVA, J. 1. Heard learned counsel for applicant and learned AGA for the State. 2. Present application has been preferred with the prayer to quash the chargesheet dated 21.04.2018 and cognizance/summoning order dated 31.07.2018 as well as entire proceedings of Case No.958 of 2018 (State Vs. Chhotelal Gautam and others), arising out of Case Crime no. 198 of 2014, under Sections 419, 420, 406 IPC, P.S.- Bhelupur, District Varanasi, pending in the court of learned Judicial Magistrate, Court No.2, Varanasi. Further prayer to quash order dated 08.01.2026 passed by learned Judicial Magistrate, Court No.2, Varanasi whereby discharge application preferred at the behest of applicant was rejected. 3. Learned counsel appearing on behalf of applicant has challenged the impugned chargesheet along with impugned orders and entire proceedings of the present case precisely on the ground that Sections 420 and 406 IPC cannot go together in the same breath as per the proposition of law settled by Hon'ble Supreme Court in the case of Delhi Race Club (1940) Ltd. and others vs. State of Uttar Pradesh and another reported in 2024 10 SCC 690. The relevant portion of the said judgment is being reproduced hereinbelow:- "38. In our view, the plain reading of the complaint fails to spell out any of the aforesaid ingredients noted above. We may only say, with a view to clear a serious misconception of law in the mind of the police as well as the courts below, that if it is a case of the complainant that offence of criminal breach of trust as Versus Counsel for Applicant(s) : Himanshu Kushawaha, Santosh Kumar Rai Counsel for Opposite Party(s) : G.A. Chhotelal Gautam .....Applicant(s) State of U.P. and Another .....Opposite Party(s) defined under Section 405 IPC, punishable under Section 406 IPC, is committed by the accused, then in the same breath it cannot be said that the accused has also committed the offence of cheating as defined and explained in Section 415 IPC, punishable under Section 420 IPC. 41. The distinction between mere breach of contract and the offence of criminal breach of trust and cheating is a fine one. In case of cheating, the intention of the accused at the time of inducement should be looked into which may be judged by a subsequent conduct, but for this, the subsequent conduct is not the sole test. Mere breach of contract cannot give rise to a criminal prosecution for cheating unless fraudulent or dishonest intention is shown right from the beginning of the transaction i.e. the time when the offence is said to have been committed. Therefore, it is this intention, which is the gist of the offence. 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. 55. It is high time that the police officers across the country are imparted proper training in law so as to understand the fine distinction between the offence of cheating vis-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 that they cannot survive without each other." 4. On the other hand, learned A.G.A. has vehemently opposed the prayer sought through the instant application but unable to dispute the settled proposition of law as relied upon by the learned counsel appearing for applicant. NA528 No. 18410 of 2026 2 5. Since the arguments as advanced on behalf of learned counsel for applicant, are based on legal issue, no notice is required to be issued to opposite party no.2. 6. After hearing the learned counsel for the parties, going through the record of the case and the judgment of the Hon'ble Supreme Court rendered in the case of Delhi Race Club (Supra), it is crystal clear that both the sections i.e. Sections 420 and 406 IPC cannot go in the same breath and as such, order of rejecting discharge application dated 08.01.2026 passed by learned Judicial Magistrate, Court No.2, Varanasi inCase No.958 of 2018 (State Vs. Chhotelal Gautam and others), arising out of Case Crime no. 198 of 2014, under Sections 419, 420, 406 IPC, P.S.- Bhelupur, District Varanasi, is set aside. Matter is hereby remitted back to learned court concerned for passing fresh order over discharge application preferred at the behest of applicant, if charges have not been framed till today, in light of the proposition of law settled by Hon'ble Supreme Court in the case of Delhi Race Club (supra). 7. Accordingly, the instant application stands allowed in part. May 5, 2026 Vivek Kr. NA528 No. 18410 of 2026 3 (Saurabh Srivastava,J.) Digitally signed by :- VIVEK KUMAR High Court of Judicature at Allahabad