APHC010357342026 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3521] THURSDAY, THE 23rd DAY OF JULY 2026 PRESENT THE HONOURABLE DR JUSTICE Y. LAKSHMANA RAO CRIMINAL PETITION NO: 5766/2026 Between: 1. AVULA BHANU PRAVEEN REDDY, S/O A. RAMANA REDDY,AGED ABOUT 35 YEARS,R/O D.NO.4-146/1, SANTHA BAZAR STREET,ROMPICHERLA, CHITTOOR DISTRICT. ...PETITIONER/ACCUSED AND 1. STATE OF ANDHRA PRADESH, Represented by the Station House Officer, Kadiri Town Police Station, Sri Sathya Sai District, Represented by the Public Prosecutor, High Court of Andhra Pradesh, Amaravati. ...RESPONDENT/COMPLAINANT Petition under Section 437/438/439/482 of Cr.P.C and 528 of BNSS praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court pleased to grant Anticipatory Bail to the petitioner/Accused no.2 in connection with Crime No. 101/2024, u/s. 403,409,420 r/w 34 of IPC, dated. 27.03.2024 of Kadiri Town PS, Sri Sathya Sai District subject to such conditions as this Hon’ble Court deems fit and pass Counsel for the Petitioner/accused: 1. M SIVA KUMAR Counsel for the Respondent/complainant: 2 Dr.YLR, J Crl.P.No.5766 of 2026 Dated 23.07.2026 1. PUBLIC PROSECUTOR The Court made the following: ORDER: The Criminal Petition has been filed under Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (for brevity ‘the BNSS’) by the Petitioner/Accused No.2 for granting of pre-arrest bail in connection with Crime No.101 of 2024 of Kadiri Town Police Station, Sri Sathya Sai District, was registered for the alleged offence punishable under Sections 403, 409 and 420 read with 34 of the Indian Penal Code, 1860 (for brevity ‘the I.P.C’). 2. Sri O.Manohar Reddy, learned Counsel appearing on behalf of Sri M. Siva Kumar, the learned counsel for the Petitioner, submits that the Petitioner is innocent of the alleged offence and he has falsely implicated by the Police. It is further submitted that the Petitioner is the sole earning member of the family and, therefore, his incarceration would cause undue hardship to his dependents. The Petitioner undertakes to strictly adhere to any conditions that may be imposed by this Court. Hence, it is urged to allow the Criminal Petition. 3. Per contra, Mr.A.Sai Rohith, the learned Assistant Public Prosecutor, vehemently opposed the grant of pre-arrest bail to the Petitioner, submitting that the investigation is still underway and several material witnesses remain to be examined. It is contended that if the Petitioner is released on anticipatory bail, there is a strong likelihood that he may abscond, thereby hampering the 3 Dr.YLR, J Crl.P.No.5766 of 2026 Dated 23.07.2026 ongoing investigation and evading the process of law. Hence, it is urged to dismiss the Criminal Petition. 4. Heard the learned Counsel for the Petitioner and the learned Assistant Public Prosecutor. Perused the record. 5. On perusal of the record, the Petitioner is arrayed as Accused No.2. The Regional Manager, State Bank of India, lodged a complaint dated 27.03.2024 before the Station House Officer, Kadiri, alleging that an amount of Rs.1,67,84,380.01/- had been routed through the bank accounts of several persons, including the Petitioner. The name of the Petitioner figures at Sl.No.1 in the table annexed to the complaint, reflecting his HDFC Bank account. The Petitioner contends that he has been residing in Malaysia for the past six years, where he is carrying on business, and that he has not visited India during the said period. The de-facto complainant has alleged that the Petitioner and the other accused committed the offences of criminal misappropriation, criminal breach of trust, and cheating. The Hon’ble Apex Court in Delhi Race Club (1940) Ltd. v. State of U.P.,1 at paragraph Nos.44 & 49 held as under: “44. At the most, the Court of the Additional Chief Judicial Magistrate could have issued process for the offence punishable under Section 420IPC i.e. cheating but in any circumstances no case of criminal breach of trust is made out. The reason being that indisputably there is no entrustment of any property in the case at hand. It is not even the case of the complainant that any property was lawfully entrusted to the appellants and that the same has been dishonestly misappropriated. The case of the complainant is plain and simple. He says that the price of the goods sold by him has not been 1(2024) 10 SCC 690 4 Dr.YLR, J Crl.P.No.5766 of 2026 Dated 23.07.2026 paid. Once there is a sale, Section 406IPC goes out of picture. According to the complainant, the invoices raised by him were not cleared. No case worth the name of cheating is also made out. 49. From the aforesaid, there is no manner of any doubt whatsoever that in case of sale of goods, the property passes to the purchaser from the seller when the goods are delivered. Once the property in the goods passes to the purchaser, it cannot be said that the purchaser was entrusted with the property of the seller. Without entrustment of property, there cannot be any criminal breach of trust. Thus, prosecution of cases on charge of criminal breach of trust, for failure to pay the consideration amount in case of sale of goods is flawed to the core. There can be civil remedy for the non-payment of the consideration amount, but no criminal case will be maintainable for it. [See : Lalit Chaturvedi v. State of U.P. [Lalit Chaturvedi v. State of U.P., (2024) 12 SCC 483 : 2024 SCC OnLine SC 171] and Mideast Integrated Steels Ltd. v. State of Jharkhand [Mideast Integrated Steels Ltd. v. State of Jharkhand, 2023 SCC OnLineJhar 301” 6. The Hon’ble Apex Court in Arshad Neyaz Khan v. State of Jharkhand2, at paragraph No.21 held as under: “21. Furthermore, it is pertinent to mention that if it is the case of the complainant/respondent No. 2 that the offence of criminal breach of trust as 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 in Section 415, punishable under Section 420 IPC. This Court in Delhi Race Club (1940) Limited v. State of Uttar Pradesh, (2024) 10 SCC 690 observed that there is a distinction between criminal breach of trust and cheating. For cheating, criminal intention is necessary at the time of making 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 misappropriates the same. Whereas, in case of cheating, the offender fraudulently or dishonestly induces a person by deceiving him to deliver a property. In such a situation, both offences cannot co-exist simultaneously. Consequently, the complaint cannot contain both the offences that are independent and distinct. The said offences cannot co-exist simultaneously in the same set of facts as they are antithetical to each other.” 7. Section 406 of ‘the I.P.C.,’ deals with criminal breach of trust, which presupposes lawful entrustment of property followed by dishonest misappropriation or conversion. In contrast, Section 420 of ‘the I.P.C.,’ addresses cheating and dishonestly inducing delivery of property, which 22025 SCC OnLine SC 2058 5 Dr.YLR, J Crl.P.No.5766 of 2026 Dated 23.07.2026 requires deception at the inception of the transaction. Thus, while Section 406 of ‘the I.P.C.,’ arises from a breach of an existing fiduciary relationship, Section 420 of ‘the I.P.C.,’ is predicated upon fraudulent inducement at the very outset. The two offences, therefore, operate in distinct spheres. 8. Accused No.1 was enlarged on bail on 20.07.2024. Accused Nos.3 and 4 were also enlarged on regular bail on 18.07.2025. Upon completion of the investigation, the charge sheet was filed showing the Petitioner/Accused No.2 as an absconder. The crime pertains to the year 2024. It is pertinent to note that Accused No.5 approached the Hon'ble Supreme Court by filing an application for pre-arrest bail. The Hon'ble Supreme Court, in SLP (Crl.) No.4108 of 2025, by order dated 18.08.2025, made the interim order granting pre-arrest bail absolute. The case of the present Petitioner stands on a similar footing as that of Accused No.5, who has been granted the benefit of pre- arrest bail by the Hon'ble Supreme Court. It is also significant to note that the Petitioner is not an employee of the bank. There is no specific allegation that the Petitioner was directly involved in siphoning off the funds of the bank. Accused No.1 was working as a Deputy Manager in the bank. The specific contention of the Petitioner, which is a matter of defence, is that the amounts transferred to his account were remitted by Accused No.1 towards discharge of a debt allegedly owed by Accused No.1 to the Petitioner, and not at the 6 Dr.YLR, J Crl.P.No.5766 of 2026 Dated 23.07.2026 instance or instructions of the Petitioner as part of any scheme to siphon off the bank's funds. 9. Considering the facts and circumstances of the case, the gravity and nature of the allegations, filing of the charge sheet, this Court is inclined to grant pre-arrest bail to the Petitioner/Accused No.2. 10. In the result, the Criminal Petition is allowed with the following conditions: i. In the event of his arrest, the Petitioner/Accused No.2 shall be enlarged on bail subject to him executing a bond for a sum of Rs.25,000/- (Rupees Twenty Five Only) with two sureties each for the like sum each to the satisfaction of the arresting police officials; ii. The Petitioner/Accused No.2 shall attend before the learned Trial Court concerned as and when required. _______________________ DR. Y. LAKSHMANA RAO, J Date: 23.07.2026 KMS 7 Dr.YLR, J Crl.P.No.5766 of 2026 Dated 23.07.2026 THE HONOURABLE DR JUSTICE Y. LAKSHMANA RAO CRIMINAL PETITION No.5766 of 2026 Date: 23.07.2026 KMS