Jharkhand High Court
Kalawati Devi vs The State Of Jharkhand on 6 July, 2026
Author: Anil Kumar Choudhary
Bench: Anil Kumar Choudhary
(2026:JHHC:21314)
IN THE HIGH COURT OF JHARKHAND AT RANCHI
Cr. M. P. No. 846 of 2022
1. Kalawati Devi, aged about 67 years, wife of Tapilal Ram,
2. Smt. Kanti Devi @ Kunti Devi, aged about 59 years, wife of late Ram
Chandar Ram,
3. Navin Kumar, aged about 44 years son of Sri Tapilal Ram,
4. Parveen Kumar, aged about 43 years, son of Sri Tapilal Ram,
(All are residents of Harmu Housing Colony, behind Qr. No. C - 1 /29,
PO & PS - Argora, District - Ranchi, Jharkhand. ... ... ...Petitioners
Versus
1. The State of Jharkhand.
2. Fulchand Saw, son of Sri Dhaman Saw, resident of Dibdih, PO -
Pundag, PS - Jagarnathpur, District - Ranchi, Jharkhand.
... ... ...Opp. Parties
------
For the Petitioners : Mr. Rahul Kumar, Advocate
For the State : Mrs. Nehala Sharmin, Spl. P.P.
------
PRESENT
HON'BLE MR. JUSTICE ANIL KUMAR CHOUDHARY
By the Court:- Heard the parties.
2. Learned counsel for the petitioners draws attention of this Court to
the supplementary affidavit showing proof of the substituted service of
notice to the opposite party No. 2 being published in the newspaper
“Prabhat Khabar, Ranchi”. Accordingly, the service of notice upon the
opposite party no.2 is sufficient. Though service of notice upon the
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Opposite Party No. 2 is sufficient yet no one turns up on behalf of the
opposite party no.2 in spite of repeated calls.
3. This Criminal Miscellaneous Petition has been filed invoking the
jurisdiction of the Court under Section 528 of the B.N.S.S., 2023, with the
prayer to quash the entire criminal proceedings initiated against the
petitioner in connection with Argora P.S. Case No. 51 of 2020 arising out of
Complaint Case No. 67 of 2015 involving the offences punishable under
Sections 406 / 420 / 34 of the Indian Penal Code and also to quash the order
taking cognizance dated 25.03.2025 passed by the learned J.M.F.C. – XIII,
Ranchi and charge-sheet dated 28.02.2025 submitted in the said case.
4. The allegation against the petitioners is that the petitioners entered
into a development agreement with the complainant – informant on
12.08.2007 and construction was started after 2010. On 11.09.2009, the
petitioners have taken money showing their urgent need for money. Rs.
8,00,000/- has been taken by the petitioner no. 3 and the petitioner no. 4 has
taken Rs. 1,98,500/-. It is next alleged that the complainant started
construction over the land and invested Rs. 2.25 crores but after completion
of the plots and the entire construction, project came under the investigation
of C.B.I. and thereafter, the complainant stopped the construction work. On
22.09.2014, petitioner no. 3 entered into the project office after breaking the
lock. Informant – complainant filed Complaint Case No. 67 of 2015 in the
Court of learned Sub – Divisional Judicial Magistrate, Ranchi, which upon
being referred to Police under Section 156 (3) of the Cr.P.C., Argora P.S.
Case No. 51 of 2020 registered and the Police took up the investigation of
the case and after completion of the investigation, Police found the
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allegations against the petitioners to be true and submitted the charge-sheet
against the petitioners for having committed the offences punishable under
Sections 406 / 420 / 34 of the Indian Penal Code and basing upon the same,
cognizance has been taken.
5. Learned counsel for the petitioners submits that charge has not yet
been framed in this case and the case is next fixed to 09.07.2026 for
appearance of the accused persons of the case.
6. Learned counsel for the petitioner by relying upon the judgment in
the case of Jai Prakash Narayan Sinha @ Jai Prakash Narain Sinha &
Another Vs. The State of Jharkhand & Another reported in
(2025:JHHC:28046) submits that therein this Court relied upon the
judgment of the Hon’ble Supreme Court of India in the case of Sarabjit
Kaur Vs. State of Punjab & Another in Criminal Appeal No. 581 of 2023
dated 01.03.2023, wherein the Hon’ble Supreme Court of India held that
the breach of contract does not give rise to criminal prosecution or cheating
unless fraudulent and dishonest intention has shown right at the beginning
of the transaction and merely on the allegation of failure to keep up the
promise will not be enough to initiate the criminal proceedings. It is next
submitted that there is no allegation against the petitioner of having any
dishonest intention right at the beginning of the transaction rather the
problem in the effective implementation of the development agreement
arose only after C.B.I. conducted the inquiry. It is then submitted that in the
agreement, there is also an arbitration clause and instead of invoking the
same, straightway the complainant – informant approached the Court
erroneously. It is next submitted that in that case, the Hon’ble Supreme
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Court also relied upon the judgment of the Hon’ble Supreme Court of India
in the case of Lalit Chaturvedi and Others vs. State of Uttar Pradesh and
Another reported in 2024 SCC OnLine SC 171, Paragraph No. 10 of which
reads as under:-
“10.xxxx 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 which hold that the same act
or transaction cannot result in an offence of cheating and
criminal breach of trust simultaneously. 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 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 an intent to activate
police machinery for recovery of money. (Emphasis
supplied).”
Wherein the Hon’ble Supreme Court of India has held that in absence
of any deception played by the accused person making false and misleading
representation, dishonest concealment of any other act or omission or
inducement of the complainant to deliver any property, the offence
punishable under Section 420 of the Indian Penal Code is not made out.
7. Learned counsel for the petitioners further submits that in that case
this Court also relied upon the judgment of the Hon’ble Supreme Court of
India in the case of Radheshyam & Others Vs. State of Rajasthan &
another reported in (2024) SCC OnLine SC 2311, Paragraph No. 12 of
which reads as under:-
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“12.xxxx In the present case, the appellants were not
entrusted with any property by respondent no. 2 –
complainant. The only delivery made was of part
payment towards an Agreement to Sell between the
parties. The amount paid towards consideration cannot
be said to have been entrusted with the appellants by
respondent no. 2. Additionally, merely because the
appellants are refusing to register the sale, it does not
amount to misappropriation of the advance payment.
Since there was no entrustment of property, the offence
of misappropriation of such property and thereby
criminal breach of trust cannot be said to be made
out.” (Emphasis supplied).”
that the amount paid towards consideration cannot be said to have
been entrusted with the accused person by the complainant and merely
because the seller is refusing to register the sale, it does not amount to
misappropriation of the advance amount paid. In that case, the Hon’ble
Supreme Court also relief upon the judgment of the Hon’ble Supreme
Court of India in the case of Uma Shankar Gopalika Vs. State of Bihar &
Another reported in (2005) 10 SCC 336, Paragraph No. 06 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)Wherein also the Hon’ble Supreme Court of India has reiterated the
settled principles of law that unless the accused plays deception since the
beginning of the transaction between the parties, the offence of cheating
will not be made out.
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8. Learned counsel for the petitioners next relies upon the judgment of
this Court in the case of Latika Chari & Others Vs. The State of
Jharkhand reported in (2024:JHHC:45032) and submits that in that case,
this Court relied upon the judgment of Hon’ble Supreme Court of India in
the case of Dalip Kaur & Ors. Vs. Jagnar Singh & Anr. reported in (2009)
14 SCC 696, Paragraph No. 10 of which reads as under: –
“10. The High Court, therefore, should have posed a
question as to whether any act of inducement on the part
of the appellant has been raised by the second
respondent and whether the appellant had an intention
to cheat him from the very inception. If the dispute
between the parties was essentially a civil dispute
resulting from a breach of contract on the part of the
appellants by non-refunding the amount of advance the
same would not constitute an offence of cheating.
Similar is the legal position in respect of an offence of
criminal breach of trust having regard to its definition
contained in Section 405 of the Penal Code. (See Ajay
Mitra v. State of M.P. [(2003) 3 SCC 11 : 2003 SCC
(Cri) 703] )” (emphasis supplied)Wherein the Hon’ble Supreme Court of India has reiterated the
settled principles of law that if a dispute between the parties, was
essentially a civil dispute resulting from breach of contract on the part of
the accused person by not refunding the amount of advance, the same
would not constitute an offence of cheating. It is next submitted that in that
case, this Court also relied upon the judgment of the Hon’ble Supreme
Court of India in the case of Satish Chandra Ratanlal Shah Vs. State of
Gujarat & Anr. reported in (2019) 9 SCC 148, Paragraph No. 11 of which
reads as under: –
“11. Having observed the background principles
applicable herein, we need to consider the individual
charges against the appellant. Turning to Section 405
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dispute arises out of a loan transaction between the
parties. It falls from the record that Respondent 2
knew the appellant and the attendant circumstances
before lending the loan. Further it is an admitted fact
that in order to recover the aforesaid amount,
Respondent 2 had instituted a summary civil suit
which is still pending adjudication. The law clearly
recognises a difference between simple
payment/investment of money and entrustment of
money or property. A mere breach of a promise,
agreement or contract does not, ipso facto, constitute
the offence of the criminal breach of trust contained in
Section 405 IPC without there being a clear case of
entrustment..” (Emphasis supplied)”
Wherein the Hon’ble Supreme Court of India has reiterated the
settled principle of law that if the property entrusted to an accused is used
by him, the mere retention of that property would not amount to dishonest
misappropriation of the property. It is next submitted that even if the entire
allegation made against the petitioners, is considered to be true in their
entirety, still neither the offence punishable under Section 406 of the Indian
Penal Code nor the offence punishable under Section 420 of the Indian
Penal Code is made out.
9. Learned counsel for the petitioners next relies upon the judgment of
the Hon’ble Supreme Court of India in the case of Anand Kumar Mohatta
& Another Vs. State (NCT of Delhi), Department of Home and Another
reported in (2019) 11 SCC 706, wherein the Hon’ble Supreme Court of
India has dealt with the essence of the offence punishable under Section 406
of the Indian Penal Code and by relying upon the judgment in the case of
Indian Oil Corporation Vs. N.E.P.C. India Ltd. reported in (2006) 6 SCC
736, observed that any effort to settle civil dispute and claims which do not
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involve any criminal offence, by applying pressure through criminal
prosecution should be deprecated and discouraged.
10. Learned counsel for the petitioners then relies upon the judgment of
the Hon’ble Supreme Court of India in the case of Krishna Lal Chawla &
Others Vs. State of Uttar Pradesh & Another reported in (2021) 5 SCC
435 and submits that therein the Hon’ble Supreme Court of India has
expressed word of caution that frivolous litigation should not become the
order of the day in India.
11. Learned counsel for the petitioner lastly relies upon the judgment of
the Hon’ble Supreme Court of India in the case of Rikhab Birani &
Another Vs. State of Uttar Pradesh & Another reported in 2025 SCC
OnLine SC 823 and submits that in paragraph no. 17 thereof, the Hon’ble
Supreme Court of India has relied upon its own judgment of Delhi Race
Club (1940) Limited v. State of Uttar Pradesh reported in (2024) 10 SCC
690, wherein it was observed that Section 420 and 406 of the Indian Penal
Code, is antithetical in nature and cannot co-exists simultaneously.
12. It is next submitted that the petitioners have revoked the power of
attorney executed by them in favour of the complainant as the informant-
complainant failed to perform his obligation under the agreement. It is next
submitted that the dispute between the parties is at best, a civil dispute and
the cloak of criminal case has been given to it only for the purpose of
wreaking vengeance. Hence, it is submitted that the prayer as prayed for in
this Cr.M.P., be allowed.
13. Learned Spl. P.P. on the other hand vehemently opposes the prayer
and submits that if the allegations made against the petitioners in the F.I.R.,
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Case Diary and the Charge-sheet, are considered to be true in their entirety,
then both the offences punishable under Section 406 and 420 of the Indian
Penal Code, are made out. Hence, it is submitted that this Cr.M.P. being
without any merit, be dismissed.
14. Having heard the submissions made at the bar and after going
through the materials on record, it is pertinent to mention here that so far as
the offence punishable under Section 420 of the Indian Penal Code is
concerned, it is a settled principle of law as has already been mentioned in
the foregoing paragraph of this judgment that to constitute the offence of
cheating, the accused must have played deception since the very beginning
of the transaction between parties.
15. Now coming to the facts of this case, there is absolutely no allegation
against the petitioners of playing deception since the beginning between the
parties. Admittedly, all was going all well before the C.B.I. conducted an
inquiry.
16. Under such circumstances, this Court is of the considered view that
even if the entire allegations made against the petitioners, are considered to
be true, still it does not constitute the offence punishable under Section 420
of the Indian Penal Code.
17. So far as the offence punishable under Section 406 of the Indian
Penal Code is concerned, even if the allegations made against the
petitioners are considered to be true, then the only allegation against the
petitioners is that petitioners have taken money either as advance or as a
loan. So, in either case, the money given by the complainant to the
petitioners cannot be termed as “entrusted” as the word entrusted has been
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used in Section 405 of the Indian Penal Code, the punishment of which is
provided for in Section 406 of the Indian Penal Code. So, in absence of any
dishonest misappropriation of any entrusted property, even if the entire
allegations made against the petitioners, are considered to be true in their
entirety, still the offence punishable under Section 406 of the Indian Penal
Code is not made out. More so, because it is a settled principle of law, as
already indicated above in the foregoing paragraphs of this judgment, both
the offences punishable under Sections 406 and 420 of the Indian Penal
Code, cannot co-exist.
18. In view of the discussions made above, this Court is of the
considered view that the dispute between the parties is at best a civil dispute
and cloak of criminal case has been given to it for the purpose of wreaking
vengeance, hence, continuation of this criminal case against the petitioner
will amount to an abuse of the process of law, therefore, this is a fit case
where the entire criminal proceedings initiated against the petitioners in
connection with Argora P.S. Case No. 51 of 2020 arising out of Complaint
Case No. 67 of 2015 for the offence punishable under Section 406 / 420 / 34
of the Indian Penal Code, taking cognizance dated 25.03.2025 passed by the
learned J.M.F.C. – XIII, Ranchi and chargesheet dated 28.02.2025 in
connection with the aforesaid case, be quashed and set aside.
19. Accordingly, the entire criminal proceedings initiated against the
petitioners in connection with Argora P.S. Case No. 51 of 2020 arising out
of Complaint Case No. 67 of 2015 for the offence punishable under Section
406 / 420 / 34 of the Indian Penal Code, order taking cognizance dated
25.03.2025 passed by the learned J.M.F.C. – XIII, Ranchi and chargesheet
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dated 28.02.2025 in connection with the aforesaid case, is quashed and set
aside.
20. In the result, this Cr.M.P., is allowed.
(Anil Kumar Choudhary, J.)
High Court of Jharkhand, Ranchi
Dated the 06th July, 2026
AFR/ Aditi
Uploaded On – 21/07/2026
11 Cr.M.P. No.846 of 2022
